NEW YORK (TheStreet) -- It's a tale of two companies. Both are off to a blistering start for 2013, both are the subject of takeover talk to one extent or another; both have seen better days, are a shadow of their former selves and are attempting to turn the corner, but will likely never again be what they once were.Both were considered growth names earlier in their history. I've long been a consumer of both of these company's products. That's where the similarities end. One is a larger, high profile name that has gotten quite a bit of attention from the value investing crowd in the past year or so, as the growth crowd moved on. The other is a small cap, with a well-known brand name, and a checkered past, that has somewhat quietly put itself back into investor's minds. These are the type of stories that are making 2013 interesting, at least for me; the companies I refer to are Dell ( DELL)and Krispy Kreme ( KKD). Cash-rich Dell, which ended last quarter with $11.3 billion or $6.50 per share in cash, but also $9 billion in debt, is up 26% year to date, and the subject of buyout rumors. The latest story is that Silver Lake Partners is finalizing a bid to take Dell private; a deal that is expected to include Dell founder Michael Dell. While it's unclear what shares might fetch in a deal, just two months ago, Dell was trading near a four-year low, and is up 45% since. It's been quite a fall from grace for Dell shares though, which were trading in the $17 range just one year ago, in the low $40's in 2005, and low $50's in 2000. Technology changed, competition in the PC space became fierce, and the company suffered the consequences. Longer term shareholders can't be happy with a deal that is anywhere close to the current price ($12.82), but those who swooped in in recent months, have done well...so far. data by YCharts
Krispy Kreme shares are up 27% year to date, and have nearly doubled since August, as skeptical investors -- that may have been burned by the company's fall from grace in its early days as a publicly traded company -- are showing renewed interest.
The recent run-up in share price may be due to some takeover speculation, although there's been nothing concrete. However, the company's adoption of a "tax asset protection plan," otherwise known as a "poison pill" early this week, lends some credence to the that speculation. The plan "discourages" new investors from taking more than a 4.99% stake in the company, and its stated intention is to preserve the value of the company's operating loss carry forwards, which for federal alone, amount to $240 million. Existing 4.99% or greater shareholders are exempt from the poison pill at current ownership levels, but not if they increase their stakes. As a Krispy Kreme shareholder, I'm not a fan of this poison pill, or for that matter, poison pills in general. It's a tale of two companies; one that wants to be sold and another that apparently does not. This should make for some interesting story lines for 2013. Now, as I type this on my Dell, I could really go for a Krispy Kreme...or two. At the time of publication the author is long KKD. Follow @JonMHellerCFA This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.