Long Term Returns of Jeff Smith’s 5 Activist Targets

In this article, we discuss long-term returns of Jeff Smith’s 5 activist targets. If you want to see more stocks in this selection, check out Long Term Returns of Jeff Smith’s Activist Targets.

5. GoDaddy Inc. (NYSE:GDDY)

Activist Investment: 2021
Long Term Returns: 8.7%
S&P 500 Gain: 17.7%

GoDaddy Inc. (NYSE:GDDY) is a company that designs and develops cloud-based products. The Applications and Commerce segment provides applications and products, including websites and marketing. In late 2021, activist investor Smith announced a 6.5% stake in the company with plans to push the domain registrar to boost its performance

While the activist investor plans could not be learned, it is common knowledge that the find always pushes for companies it believes can help boost margins or improve performance. The hedge fund could also seek board representation as one of the ways of engineering strategic plays to unlock shareholder value.

4. LivePerson, Inc. (NASDAQ:LPSN)

Activist Investment: 2022
Long Term Returns: 17.3% Gain
S&P 500 Gain: 22.7%

LivePerson, Inc. (NASDAQ:LPSN) is a software company that uses conversational artificial intelligence. Its Business segment leverages Conversational Cloud’s intelligence engine to connect with consumers, while the consumer segment facilitates online transactions between experts and users seeking information.

LivePerson, Inc. (NASDAQ:LPSN) stock jumped by 11% in early 2022 after activist investor Starboard Value confirmed an 8.5% stake in the company and plans to nominate directors to the board. Mid-that year, the company reached an agreement with the activist investor on appointing new independent directors, with one slot being reserved for the investor.

The investment and the board appointment came as LivePerson, Inc. (NASDAQ:LPSN) was undergoing a rough patch despite doing the right things by expanding into messaging from chat. With Starboard on board, there are multiple paths to reinvigorating the company’s fortunes, not limited to enhancing better management and encouraging disciplined operational strategy. There is also a possibility of the company being put on sale to avert a proxy fight.

3. Rogers Corporation (NYSE:ROG)

Activist Investment: 2023
Long-Term Returns: 14% Gain
S&P 500 Gain: 18%

Rogers Corporation (NYSE:ROG) is a global leader in engineered materials that power, protect, and connect the world. The company designs, develops, and manufactures engineered materials and components worldwide. At the start of 2023, activist investor Starboard Value had amassed a sizeable stake in the company and was seeking seats on the board to push for changes aimed at unlocking value.

The board challenge is in response to the chemical company DuPont pulling away from a $5.2 billion deal to acquire the company late last year, resulting in the stock tanking 47%. Consequently, the activist investor announced it will push for three seats on the board after amassing a 6.5% stake.

In February, Rogers Corporation (NYSE:ROG) agreed with the activist investor and offered two seats on the board, expected to stop any proxy fight.

It still needs to be determined whether the investor will influence the management to pursue strategic alternatives to unlocking value.

2. Algonquin Power & Utilities Corp. (NYSE:AQN) 

Activist Investment: 2023
Long-Term Returns: 7% Gain
S&P 500 Gain: 18%

Algonquin Power & Utilities Corp. (NYSE:AQN) is a renewable energy and utility company providing North American energy and water solutions. It operates through two segments: Regulated Services Group and Renewable Energy Group. Starboard Value targeted the company in 2023 after amassing more than a 5% stake.

The activist investor is urging the company to consider a review of its renewable energy division, having reiterated that its core regulated utility businesses are highly undervalued. Algonquin Power & Utilities Corp. (NYSE:AQN) engaged the services of JPMorgan early in the year to review possible alternatives.

1. RB Global, Inc. (NYSE:RBA)

Activist Investment: 2023
Long-Term Returns: 25.6% Gain
S&P 500 Gain: 18%

RB Global, Inc. (NYSE:RBA) is a global leader in asset management that offers live and online auctions, among other services. The company conducts auctions at physical sites worldwide while providing asset storage, onsite equipment inspection, and certainty for sale.

The company was the subject of a strategic investment from Starboard Value in early 2023.

The activist investor purchased $485 million of convertible preferred stock and $15 million of common shares of RBA. The investment entitled Starboard for a seat on the board. RB Global, Inc. (NYSE:RBA) caught the attention of the activist investor in late 2022 after it entered into a merger agreement to acquire IAA. The acquisition has been fraught with opposition, given that IAA is a company that has not been run very well and has been losing market share.

While the activist investor also joined the bandwagon in questioning the acquisition unit, it later changed its position after engaging Ritchie Bros Auctioneers Inc. management and board. The company secured enough votes to secure the acquisition in March despite some activist investors opposing it.

It still needs to be made clear the long-term plans that Starboard Value has for the online auction company and how they will affect RB Global, Inc. (NYSE:RBA)’s performance and shareholder value.

Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily newsletter to get  the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also check out our articles on Long-Term Returns of Keith Meister’s Activist Targets and Long-Term Returns of Carl Icahn’s 40 Activist Targets.