15 Stocks Targeted By Activist Hedge Funds

4. Starbucks Corporation (NASDAQ:SBUX)

Company Market Cap as of December 31: $103.46 Billion

Number of Hedge Fund Holders: 76

Starbucks Corporation (NASDAQ:SBUX) operates as a roaster, marketer, and retailer of coffee worldwide. Its stores offer coffee, tea, and other beverages, roasted whole beans, and ready-to-drink beverages. Starbucks was down by 2.5% in 2024. As inflation strains their finances, customers are going to coffee shops less frequently.

After struggling with sales in the US and China, Starbucks Corporation (NASDAQ:SBUX) became one of the most targeted by activist hedge funds. Elliott Investment Management was the first to accrue significant stakes in the coffee retailer concerned by its underperformance in recent years. The activist hedge fund consequently started pushing for strategic changes affected by the company’s negative investor return over the past five years despite posting strong growth in business.

Elliott Investment Management is yet to disclose its strategy at Starbucks Corporation (NASDAQ:SBUX). Nevertheless, activist hedge funds are best known for pushing for changes in leadership and strategy to boost shareholder value in companies in which they are involved.

Here is what Invesco Growth and Income Fund said about Starbucks Corporation (NASDAQ:SBUX) in its Q3 2024 investor letter:

“Starbucks Corporation (NASDAQ:SBUX): The coffee retailer has struggled with China’s economic softness, declining sales and weaker US store traffic that have hampered revenues and profit margins. However, we believe the company has several positive, long-term catalysts, including strong growth in store count, better labor relations, improving productivity from labor, technology and innovation, and easier future earnings comparisons. We believed a management change was imminent, and shortly after we purchased the stock, Starbucks named a new CEO, which was seemingly greeted enthusiastically by investors.”