The San Fernando Valley’s public-company sector experienced a transformation this year as major corporations in the health care, real estate, manufacturing and technology industries were either acquired by larger players or relocated out of state. James Hillman, managing director of the L.A. office for BNY Mellon Wealth Management, said that at this late stage in the current economic cycle, equity performance becomes more modest and companies look for ways to grow and leverage their assets. “That’s when you will see acquisition activity increase,” Hillman said. “Companies both public and private in the midrange are selling at this time.” Overall, Hillman described the 2015 market as volatile. That was best reflected in activity from the end of August that resulted in a correction to the market. “The correction brought valuations of public companies back to where they should have been,” he said. That late-August inflection resulted in the price of Walt Disney Co. shares going briefly below $100, where it had been since February. Thousand Oaks pharmaceutical giant Amgen Inc. had its shares drop by $10, or 6 percent, before recovering, while Avery Dennison Corp. in Glendale saw a decrease of $5, or 7 percent, before rising again. The correction also affected Teledyne Technologies Inc., a Thousand Oaks manufacturer of aerospace, marine and energy products. Its price starting in late February had broken the $100 barrier but dropped below that mark as part of the correction and has not been above since. As of Dec. 9, Teledyne shares had lost 15 percent of their value since the beginning of the year. Chris Quilty, an analyst with Raymond James & Associates Inc. in St. Petersburg, Fla., wrote in a research note from early November that Teledyne is facing a number of factors affecting its financials, including a strong U.S. dollar and weakness in energy exploration – an industry to which Teledyne supplies equipment. Still, Quilty has given Teledyne an “outperform” rating with a target price of $100. “We expect Teledyne to deliver positive (earnings per share) growth in 2016, driven by a top-line recovery, a leaner expense structure, accretive acquisitions and stock repurchases,” Quilty wrote in the note. Deal tally The acquisition of Valley public companies started in March when Vitesse Semiconductor Corp. in Camarillo was bought by Aliso Viejo semiconductor maker Microsemi Corp. in a deal valued at $389 million. The purchase added to Microsemi’s offerings of chips and components for the Internet of Things, the wireless connections among devices in both industrial and consumer applications. Other buyouts came in quick succession: Kythera Biopharmaceuticals Inc. and Ryland Group Inc. in June; Health Net Inc. in July; and IPC Healthcare Inc. in August. All were deals valued in the billions. Health Net in Woodland Hills topped them all with its $6.8 billion acquisition by Centene Corp. Health Net will provide geographic reach into the California and Arizona markets for the St. Louis health insurance provider. Kythera, in Westlake Village, was bought by Dublin, Ireland’s Allergan, which has U.S. operations based in Parsippany, N.J. Kythera owns Kybella, an injectable treatment that dissolves chin fat. Westlake Village’s Ryland merged with Irvine homebuilder Standard Pacific Corp. to form the country’s fourth-largest residential home developer. The combined companies are now known as CalAtlantic Group Inc. IPC in North Hollywood was bought by Team Health Holdings Inc. of Knoxville, Tenn., for $1.6 billion in cash. Both companies supply doctors to hospitals and nursing homes and combined will have a network of 15,000 doctors and nurses. This acquisition activity was expected, given that the market is in the mid- to late term of a bull market, said BNY’s Hillman. “Acquirers have capital to invest and a fair amount of liquidity and are looking for places to get a return (on investment),” he said. “That has resulted in the upward number of acquisitions.” In addition to all those acquisitions, the Valley lost another public company through relocation this year. Aluminum wheel manufacturer Superior Industries International Inc. moved its headquarters from Van Nuys to Southfield, Mich., to put the company closer to its Detroit customers. The move was completed in late summer and resulted in the loss of about 50 managerial and clerical positions. Large caps Two of the most prominent industry sectors in the Valley – biotech and entertainment – have felt volatility this year as well. Amgen, for instance, has fluctuated from $130 to $181, but closed at $157.89 on Dec. 9, an increase of only 1.1 percent for the year. Karen Andersen, a senior analyst who follows the biotech industry for Morningstar Inc. in Chicago, wrote in a research note in early October that biosimilars – copycat versions of the expensive biologic medicines Amgen develops – will cut into sales of its anemia drugs Epogen and Aranesp as well as chemotherapy treatments Neupogen and Neulasta. Andersen remains optimistic about Amgen over the long term, however. “We’re confident that Amgen will be capable of defending its bottom-line growth through a key period of weakness for legacy products, buying it time to develop the sales potential for newer products and pipeline opportunities,” Andersen wrote in the note. As for MannKind Corp., a smaller-cap biotech in Valencia, problems are mounting as the year draws to a close. The company has seen its shares drop by about 70 percent through Dec. 9 when it closed at $1.55. Morningstar’s Andersen said in an October research note that he lowered his fair value estimate of MannKind shares to $2.50 as sales of its inhalable insulin drug, Afrezza, continued to struggle since its introduction in February. MannKind has an agreement with French company Sanofi SA to market the drug. “Given that MannKind’s future is almost entirely reliant on Afrezza’s success and its cash balance is dwindling, we view MannKind’s shares as having an extreme uncertainty rating and being overvalued at current prices,” Andersen wrote. Disney remains the biggest local entertainment company in terms of market capitalization. And analysts are certain that the December release of “Star Wars: The Force Awakens” as well as the opening next year of a new Shanghai theme park will create an updraft for the stock price. Disney shares traded at $93.65 at the start of the year and had increased 19 percent by Dec. 9 when it closed at $111.47. Shares reached a high of $121.69 on Aug. 4. Neil Macker, an equity analyst with Morningstar who follows Disney, said in a research note in November that while Disney’s financial health is solid its results could suffer if the company fails to adapt to a changing media landscape or if the economy weakens. “ESPN garners the highest affiliate fees of any basic cable channel and a decrease in pay-TV penetration would slow down revenue growth,” Macker said in the note. “The cost of sports rights may continue to skyrocket, putting pressure on margins.” This year actually proved beneficial to another Tri-Cities entertainment company, DreamWorks Animation SKG Inc., which reversed its rough run of 2014. The Glendale film and TV studio opened the year at $22.46 and closed up nearly 14 percent as of Dec. 9 at $25.46. The price dipped into the high teens at times throughout the year but has since recovered. Its high close was $28.01 on June 24 – a marked improvement from last year when shares lost 36 percent of their value. Chief Executive Jeffrey Katzenberg shook up the corporate suite in January by naming Bonnie Arnold and Mireille Soria co-presidents of feature animation, replacing Bill Damaschke, who had served as chief creative officer since 2011. The studio also cut 500 employees, closed its Redwood City facility and reduced the number of feature films it would release annually from three to two. Additionally, a pair of top executives – the chief operating and chief marketing officers – left the company. Finally, DreamWorks sold its Glendale campus to SunTrust Banks Inc., an Atlanta bank holding company and then leased it back. In July, SunTrust sold the 14.7-acre campus to Griffin Capital Essential Asset REIT of El Segundo. Those changes seemed to please investors, as did its decision to release only one film, “Home,” which made $386 million in global box office and became a surprise hit. Eric Wold, a senior analyst with L.A.’s B. Riley Financial Inc. who follows DreamWorks, said the improved stock performance is reflective of investors being optimistic about the restructuring plan. The company is by no means out of the woods, said Wold, but the success of “Home” and anticipation for “Kung Fu Panda 3,” a co-production made in China, points to good things coming. “You can never bat 1.000, but with a plan in place you can make more winners than losers,” he told the Business Journal. In a research note from early November, Wold noted that “Home” generated the highest number of digital downloads of any DreamWorks Animation film and that boded well for future releases in the format.