10 Cheap Value Stocks to Invest In, According To Seth Klarman

7. Solventum Corporation (NYSE:SOLV)

Number of Hedge Fund Holders: 48

Forward Price to Earnings Multiple: 12.76

Baupost Group’s Holdings: $126.89 Million

Solventum Corporation (NYSE:SOLV) is a healthcare company that develops, manufactures, and commercializes a portfolio of solutions to address critical customer and patient needs. After going down by about 9% in 2024, activist investor Trian Fund Management insists the stock is trading at a discount compared to its peers.

The activist investor fund founded by billionaire Nelson Peltz has weighed on Solventum Corporation’s (NYSE:SOLV) performance and started pushing for strategic changes it believes can help unlock hidden value. The firm wants the company to focus on reaccelerating organic growth and restoring margins while simplifying its business portfolio.

The push for strategic changes comes on Solventum Corporation (NYSE:SOLV) embarking on a three-phase strategy to reinvigorate growth prospects. Part of the strategy entails moving production lines from 67 factories to 27 Solventum plants. It also plans to trim its distribution facilities to 73 from 122 as it also reorganizes its supply chain and distribution network. The restructuring also comes against the backdrop of Solventum delivering solid third-quarter results on November 7, whereby sales increased by a modest 0.4% to $2.08 billion. Nevertheless, its earnings per share fell 42.9% to $1.64. Despite the significant earnings miss, the company raised its full-year guidance, projecting organic sales growth of between 0% and 1%, with earnings per share of between $6.50 and $6.65.