7. Fortune Brands Home & Security Merges With Masco
Next up, how about a merger of equals? Fortune Brands Home & Security ( FBHS) and the Masco Corporation ( MAS). Both companies are dominant kitchen and bath parts makers, think Moen and Aristokraft for Fortune and Delta and Kraftmaid and Merillat for Masco. The merger could turn the tables on the Home Depots ( HD) and the Lowes ( LOW) while riding the new housing boom wave, one that I think will cross back to a million starts a year in 2013, more than double where they were two years ago. Consider this one the son of the value-creating Black & Decker Stanley Works merger. Two plus two equals five here taking Masco up to the mid 20s from its $16 perch if they take my suggestion. I prefer playing this one with Masco if only because it is up much less and will have more room to run if no deal occurs.