3Com (COMS): Which moved 20% higher intraday when it reported earnings last. Last year, private-equity firm Bain Capital and Chinese based Huawei Technologies has proposed a $2.2 billion dollar deal, which was rejected by the U.S government, over concerns that sensitive military technology could be compromised by the Chinese government. The market has totally forgotten that on August 5th 3Com (COMS) raised its forecast for the fiscal first quarter, saying that $335 million to $340 million, compared to the previous estimate of $325 million to $330 million. The company also expects its non-GAAP earnings per share to be in the range of 6 cents to 8 cents, compared to the prior view of 3 cents to 5 cents. 3COM seems like a good risk/reward trade ahead of the quarter

Huntsman Chemical (HUN): As we speak, Huntsman’s management is in court fighting a nasty lawsuit against private-equity firm Apollo, and its founder Leon Black. Huntsman agreed last year, in principal, to be purchased by Apollo for $28 a share. However, Apollo recently invoked an “adverse change” clause and walked away from the deal, thus creating a nasty lawsuit. Huntsman currently trades with a forward P/E of 15 and an EV/EBITDA of 9.1.Last quarter, Huntsman's revenue rose to $2.9 billion from $2.47 billion during the year-ago period, helped by higher selling costs. Revenue from the company's polyurethane segment increased to $1.16 billion from $1.01 billion during the second quarter last year. Materials and effects revenue increased to $688.8 million from $621.5 million. Performance products revenue jumped to 725.1 million from $548.4 million, while pigments revenue increased to $320.7 million from $293.2 million.

Anheuser-Busch (BUD): Anheuser-Busch, which is trading 10% below its takeover price of $52 billion, or $70 per share, is the best risk arbitrage out there today in the market. Here InBev, the acquirer proposed to purchase the shares of BUD for $70 per share. Until the acquisition is completed, the stock of the target typically trades below the purchase price. An arbitrageur will buy the stock of the target and makes a gain if the acquirer ultimately buys the stock. Recently Brazilian antitrust regulators approved without restrictions the sale of BUD to InBev.

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