Sandell Asset Management Presentation on Bob Evans Farms Inc (BOBE): Sets a $90 Target Price

Tom Sandell and his fund Sandell Asset Management have issued a presentation explaining their position on Bob Evans Farms Inc (NASDAQ:BOBE). Moreover, in the filing with the Securities and Exchange Commission, the investors revealed a stake, which contains around 2.08 million shares, slightly up from approximately 2.0 million shares held previously.

Bob Evans Farms

In the presentation, Sandell said that the company has underperformed mainly because of the failed policies and a wasteful culture promoted by an entrenched Board. Bob Evans Farms Inc (NASDAQ:BOBE) has very high SG&A expenses, repeated reductions in its guidances, and over $900 million worth of real estate value not reflected in its stock price.

In addition, the investor considers that the Board of Directors is also to be blamed for the company’s weak results. Sandell has invoked the longevity of directors’ serving time on the board (14 years on average).  The whole board is connected to the chairman and CEO, Steven Davis and among themselves, which creates a conflict.

“To address these problems and best position Bob Evans to deliver enhanced shareholder value, the Board needs a fresh, independent, highly- qualified Board of Directors that is able to provide effective management oversight and bring new perspectives and ideas to the Company,” the presentation said.

Earlier today, Sandell issued a press release proposing eight independent directors to be elected to the company’s board. The candidates proposed by the fund are highly qualified and have experience in restaurant operations, corporate governance, finance, etc.

Sandell also proposed a bunch of measures that could enhance the value of the company. From the operational point of view, the fund said that Bob Evans Farms Inc (NASDAQ:BOBE) has to re-focus its brand to expand its traffic and same store sales in the long-term. The capital spending of the company needs to be scrutinized and a new culture of more prudent capital budgeting should be installed. The value of the real estate also has to be unlock, to increase the stock price of the company. If this plan is realized, Sandell considers that the stock price of the company could amount to $90 per share, and Bob Evans could realize over $6.00 in annual EPS power.

The full presentation can be accessed below:

Sandell Asset Management Presentation on Bob Evans Farms

Earlier today, Tom Sandell has been interviewed by CNBC regarding his views on Bob Evans Farms Inc (NASDAQ:BOBE). He said that “”The company has underperformed their peers by 130% in the equity markets over the past five years and they have a corporate waste, for example their operating margins are 500 basis points lower than the peer group.”  Moreover, Mr. Sandell has also mentioned his $90 target price for the company’s stock.

Disclosure: none

Recommended Reading:

Sandell Asset Management Increases Holding of Bob Evans Farms Inc (BOBE) Shares

Luminus Management Raises Stake In Dynegy Inc. (DYN) To Nearly 6%

Billionaire Leon Cooperman Purchases More Shares of Resource Partners, L.P. (ARP)

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

Top 6 Cities For The Ultra Rich to Live in Comfort

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!