As revealed by a 13D filing, Starboard Value LP is no longer a beneficial owner of more than 5% of RealD (NYSE:RLD)’s shares, as of January 26, 2016. The newly-amended filing discloses an ownership stake of 2.55 million shares, which make up 4.97% of the company’s outstanding common stock. The widely-known hedge fund firm owned 4.95 million shares of the licensor of 3D and other visual technologies at the end of September. In November 2015, the company agreed to be bought by Rizvi Traverse Management LLC for $11 per share in cash. The proposed buyout is anticipated to be completed in or shortly after the company’s fourth quarter of fiscal year 2016 that ends March 31. RealD (NYSE:RLD)’s management believes that its 3D cinema business has already matured in many markets, including the United States, while the 3D box office performance of certain motion pictures has been impacted by fast-changing consumer preferences. With expectations of slowing equipment installations, the aforementioned deal might appear to be an appropriate move. However, some tend to believe that the deal was priced much too low, considering that at least one Wall Street analyst has a price target of $16.00 per share on the stock. A total of 16 smart money investors from our system had stakes in the company at the end of the third quarter, stockpiling nearly 36% of its outstanding shares. Brett Hendrickson’s Nokomis Capital owned 1.79 million shares of RealD (NYSE:RLD) on September 30.
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In a Schedule 13G filing, Alexander M. Seaver’s Stadium Capital Management LLC reported owning 11.23 million shares of Ascena Retail Group Inc. (NASDAQ:ASNA), which constitute 5.7% of the company’s total shares. This marks an increase of 3.33 million shares from the stake revealed through the fund’s 13F for the September quarter. The shares of the specialty retailer of apparel for women and tween girls are down by 36% over the past year. Earlier this month, the company revealed that its comparable store sales for the Holiday period (November 21, 2015 through January 3, 2016) decreased by 4% year-over-year, which has put significant weight on the stock. In light of that, what has prompted Stadium Capital to purchase more shares of the apparel retailer? By solely relying on P/E multiples, one could argue that Ascena Retail Group Inc. (NASDAQ:ASNA) represents an attractive long-term bet. The stock trades at a forward P/E of 7.81, so investors could put their faith in analysts’ earnings estimates and go long the stock. In August 2015, the company purchased ANN Inc., a retailer of women’s apparel whose products are mainly sold under the Ann Taylor and LOFT brands, for roughly $2.1 billion. 23 hedge funds from our system were invested in Ascena at the end of the third quarter, owning 17% of the company’s outstanding shares. Joel Greenblatt’s Gotham Asset Management reported owning 2.66 million shares of Ascena Retail Group Inc. (NASDAQ:ASNA) via its 13F for the September quarter.
