Starboard Value, run by Jeffrey Smith, is one of the most famous activist hedge funds and is well known to the investment community. The fund registered a resounding success in its activist efforts with Darden Restaurants, Inc. (NYSE:DRI), having managed a complete overhaul of the company’s board of directors. It has also led the efforts to merge Yahoo! with AOL. Although it did not go according to plan, in the end Smith got what he wanted when Verizon Communications Inc. (NYSE:VZ) acquired Yahoo! in 2016, having previously bought AOL as well.
Although Smith and Starboard are currently embroiled in a proxy battle for Mellanox Technologies, Ltd. (NASDAQ:MLNX) board of directors, there is no doubt they are also preparing the field for future activist efforts. Insider Monkey has analyzed Starboard’s latest 13F filing, looking for potential targets.
First we will take a look at Bemis Company Inc (NYSE:BMS), a manufacturer of packaging products. The company has been active since 1858 and is currently operating in two segments: U.S. Packaging, which accounts for 65% of sales, and Global Packaging, which makes up 35% of sales. Bemis’ major customers include industry giants like Kraft Heinz Foods Co (NYSE:HNZ), Allergan plc Ordinary Shares (NYSE:AGN) and Procter & Gamble Co (NYSE:PG).
Starboard first disclosed a stake in Bemis Company Inc (NYSE:BMS) back in November 2018 when it issued its 13F filing for the 2017 third quarter. The fund acquired exactly 1.5 million shares and added a further 630,000 shares during the subsequent quarter to amass roughly 2.34% of the company’s outstanding stock. It is yet unclear whether Jeffrey Smith is planning to make a move, since Starboard has not yet submitted a 13D filing, which is usually the case with activist positions.
Industry and Stock Performance
According to data by Fidelity, the Containers & Packaging has registered a 12.9% growth in the past 13 months, compared to the S&P500 index’s 16.5 rise, with revenues increasing by 9.17%. Bemis’ stock, on the other hand, has tanked 8.65% during the same period of time. The stock has also been overshadowed by competitors such as Graphic Packaging Holding Company (NYSE:GPK), which rose by 11.6%, and Owens-Illinois Inc (NYSE:OI), currently up by 7.2%, in the past twelve months.