Investment idea generation.

Blog

Our thoughts.

Activism Daily: Buyback Bust

Here’s the activist news, updates, good reads and must know news for July 20. Sign up for the free newsletter here.

Stake changes -

  • 40 North ups its stake in Mattress Firm Holdings. Been activist since Aug. 2013. Now own more shares than ever, with a 10.9% stake.

  • Stephens Investment owns the most of Conn’s it has since 2012. They own 19.5%.

Updates -

  • M&A rally - Corvex Management now has small stakes in U.S. seeds company Monsanto and its aspiring acquirer, Germany's Bayer AG. Corvex, which also owned Monsanto stock two years ago, would favour a sale to Bayer for a rich enough price, said the people, who asked not to be identified because the matter is not public.

  • Boarding - SABMiller’s board this week will discuss growing pressure from investors to seek a higher cash takeover offer from Anheuser-Busch InBev NV after fund managers complained that the deal is much less attractive following the plunge in the pound, people familiar with the matter said. Firms including TCI Fund Management, Davidson Kempner Capital and Elliott Management have asked SABMiller to reconsider AB InBev’s 44-pound-a-share cash bid.

Activist short-selling -

  • Odey Betting Against Intu After Brexit [link]

  • Copperfield Reserach announces long position in Presciencer Point shrot taret Stamps.com [link]

  • Asensio Interview with Activist Insight [link]

  • Noble Said to Quit European Power, Gas on Liquidity Crunch [link]

  • UPDATED: Beleaguered Zafgen crushed after FDA demands force it to dump lead drug [link]

Catalyst watchlist ideas -

  • Wedbush discusses strategic alternatives and opportunities for GNC and VSI. GNC could be in play as an M&A target.

  • Kellogg said not to be in talks Kraft Heinz about a buyout.

  • Craig-Hallum out with another strong note defending Stamps.com, says buy with $150 price target, also calls short call is timed well-given company’s quiet period.

Your one must read -

  • Active Managers Stumble Again as Tools Like Buybacks Lose Luster [link] Once-reliable tools for active managers are being sapped of their potency by an aging bull market, sending mutual funds to some of their worst relative returns in history. So say Bank of America Corp. strategists, who found that stock selection based on normally bullish harbingers like buybacks, takeovers and activist interest didn’t work in the first half of 2016. Too much dependence on such signals worsened an already brutal year for large-cap managers, with only 18 percent beating the Russell 1000 Index through June 30, the research found.

Other good reads -

  • United Airlines plans $2 billion buy back, scale back growth [link] This is the airline targeted by two pseudo activists. I’m still not interested in airlines, but you guys have at it.

  • Pershing Square: An Update on Herbalife and Second Quarter Result [link]

  • Why This Activist Investor Is Buying Fleetwood [link] Profile of why Sandon is buying up shares of Fleetwood.

Don’t forget, to get goodies like this in your inbox, sign up for the free daily newsletter.

Activist Stocks