Making $1700 (10%) in 8 days with that JNJ deal

There was a deal a few weeks ago where you could make $1000 in 2 weeks by buying 99 shares of Johnson and Johnson stock. It was so popular that a friend even sent me the Barron’s article and it was posted on Twitter. I was very hesitant to jump on the deal since I believe the stock market is efficient and would price these things in, meaning I was fully expecting KVUE stock to tank after the shares are issued.

I didn’t do anything until about 2 days before the deadline before I decided to do it for shits and giggles. I bought 99 shares of JNJ stock in my Fidelity retirement account for $17,082 on Aug 16. I then called up Fidelity and told them I wanted to tender the odd lot. The phone call took about 10 minutes for the rep to fill things out. The shares were delivered on 8/24 and surprisingly KVUE stock pretty much stayed the same. I then sold the shares for $18,747.

I think the reason why KVUE didn’t tank is that retail investors are such a small piece of the market (go watch the Gamestop documentary on Netflix,) that a bunch of us 99 share buyers is like throwing a pebble in a lake. Also, KVUE was going to be added to the S&P500 too, so it had reasons to hold its value. Here’s a quote from the updated Barron’s article:

There were about 6.5 million J&J shares submitted as odd lots out of a total of 800 million. That’s around $1 billion of odd-lot tenders. J&J accepted roughly 191 million of its shares in the offer in exchange for 1.53 billion Kenvue shares. J&J continues to hold about 180 million shares, a 9.5% stake.

Looking back, of course I wish I had done this more than once, but this was my first odd lot tender and once again, I thought the market would factor this in. On to the next one…