An amended 13D filing with the Securities and Exchange Commission revealed that Glenn W. Welling‘s Engaged Capital has significantly decreased its stake in Outerwall Inc (NASDAQ:OUTR), as it currently owns 1.05 million common shares, which amass 6.1% of the company’s outstanding stock. As disclosed in its previous 13D filing on the company, Engaged Capital held 2.43 million shares, which accounted for 14.1% of Outerwall’s float.
Outerwall is a company engaged in the business of retail, offering its customers self-service kiosks for renting movies and video games, while also running coin-cashing machines. Recently, the company signed a merger agreement with certain funds managed by Apollo Global Management LLC to be acquired by the private equity firm’s affiliates for approximately $1.6 billion. Given that, it’s not surprising to see Engaged Capital cut its position, as there is limited upside left in the stock.
Over the past 12 months, Outerwall’s shares have dropped by 20.09%. In its financial report for the second quarter of 2016, the company reported earnings per share from continuing operations of $2.38 and revenue of $518 million, beating both top- and bottom-line estimates of earnings per share of $1.37 and revenue of $487 million. Recently, B. Riley reiterated its ‘Buy’ rating on Outerwall’s stock, with a price target of $58.00, while Dougherty & Co downgraded its rating to ‘Sell’ from ‘Neutral’.
As per our hedge fund database, the number of investors long Outerwall (NASDAQ:OUTR) decreased by five in the first quarter, as at the end of March, the company was in 22 hedge funds’ portfolios. Aside from Engaged Capital, which held the most-valuable position in Outerwall (NASDAQ:OUTR), big investors were Debra Fine’s Fine Capital Partners, which held the second-largest stake worth $50.9 million. Some other peers with similar bullishness included Allan Mecham and Ben Raybould’s Arlington Value Capital, and Joel Greenblatt’s Gotham Asset Management. Hedge funds that dumped Outerwall (NASDAQ:OUTR) during the quarter were William C. Martin’s Raging Capital Management and James Dondero’s Highland Capital Management.
You can access the original SEC filing by clicking here.
Ownership Summary Table
|Name||Sole Voting Power||Shared Voting Power||Sole Dispositive Power||Shared Dispositive Power||Aggregate Amount Owned Power||Percent of Class|
|Engaged Capital Flagship Master Fund||296,960||296,960||296,960||1.7%|
|Engaged Capital Co-Invest III||716,307||716,307||716,307||4.2%|
|Engaged Capital Flagship Fund||296,960||296,960||296,960||1.7%|
|Engaged Capital Flagship Fund, Ltd||296,960||296,960||296,960||1.7%|
|Engaged Capital Holdings||1,054,923||1,054,923||1,054,923||6.1%|
|Glenn W. Welling||1,054,923||1,054,923||1,054,923||6.1%|
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