Long Term Returns of Paul Singer’s 5 Activist Targets

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

5. NXP Semiconductors N.V. (NASDAQ:NXPI)

Activist Investment: 2017
Long-Term Returns Since Singer’s Investment: 82%
S&P 500 Gain Since Singer’s Investment: 103%

NXP Semiconductors N.V. (NASDAQ:NXPI) is a company that designs, manufactures, and sells various semiconductor products, including microcontrollers, application processors, and wireless connectivity solutions. Elliot Management first disclosed a 6% stake in the company in 2017.

The confirmation came when QUALCOMM Incorporated (NASDAQ:QCOM) had tabled a $110 a share for NXP Semiconductors N.V. (NASDAQ:NXPI), valuing the chip company at $37 billion. The activist investor opposed the takeover bid, insisting it was low and undervalued the company. It reiterated plans to engage in dialogue with Qualcomm’s board and other potential acquirers to maximize shareholder value.

QUALCOMM Incorporated (NASDAQ:QCOM) increased its takeover bid to $127.50 a share amid mounting pressure. Elliot approved the bid, insisting it reflected a positive outcome for shareholders. Nevertheless, the deal fell through in 2018 after Qualcomm failed to secure Chinese regulatory approval.

4. Telecom Italia S.p.A. (TIT.MI)

Activist Investment: 2018
Long-Term Returns Since Singer’s Investment: -75%
S&P 500 Gain Since Singer’s Investment: 65%

Telecom Italia S.p.A engages in the provision of fixed and mobile telecommunications services. It provides both landline and mobile voice as well as internet services. Through Elliot management, Singer first disclosed a 9% stake in the telecommunications company in 2018, valued at about £1 billion.

After that, the activist investor embarked on a proxy battle, pushing for significant management changes. The push resulted in shareholders voting to form a new board, therefore ending a bitter battle of control between Elliot Management and French conglomerate Vivendi.

The Singer secured two-thirds of the seats on Telecom Italia S.p.A’s board. Vivendi, which owned 24%  of the company, demanded a revocation of five board members appointed by Elliot, insisting the activist investor had instigated a coup. The two warring parties would reach a truce in 2019 with the appointment of a new board.

3. Commvault Systems, Inc. (NASDAQ:CVLT)

Activist Investment: 2018
Long-Term Returns Since Singer’s Investment: 68%
S&P 500 Gain Since Singer’s Investment: 31%

Commvault Systems, Inc. (NASDAQ:CVLT) provides a data protection platform that helps customers secure, defend, and recover data. It offers Commvault Backup and Recovery, a backup and recovery solution. Elliot Management first disclosed a 10.3% stake in the company in 2018. The activist investor also announced plans to nominate four directors of the company’s 11-member board, consequently triggering a proxy battle.

 The activist investor echoed its frustration with Commvault Systems, Inc. (NASDAQ:CVLT)’s dwindling margins and insisted management changes were crucial. In addition to pushing for management changes, the activist investor wanted management to consider a potential business sale.

“We are optimistic that we can work together with the Board to reach a collaborative agreement that will be in the best interests of the Company and its shareholders,” Elliott wrote in the letter to Commvault’s board.

Management bowed to the activist pressure and agreed to appoint three new independent directors to the board. It also agreed to launch a $200 million share repurchase program and implemented a cost reduction plan.

2. CorMedix Inc. (NASDAQ:CRMD)

Activist Investment: 2021
Long-Term Returns Since Singer’s Investment: -46%
S&P 500 Gain Since Singer’s Investment: 19%

CorMedix Inc. (NASDAQ:CRMD) is a biopharmaceutical company that develops and commercializes therapeutic products to prevent and treat infectious diseases. Elliot management first disclosed a 9.9% stake in the company in 2021 and initiated talks with the board and management regarding strategic alternatives.

The activist investor reiterated that CorMedix Inc. (NASDAQ:CRMD) was highly undervalued and backed by solid lead products, including Defencath, a catheter solution. Consequently, it started pushing for operational improvements, management changes, and improved capital structure to help maximize shareholder value. Elliott Management also suggested the company consider a potential sale or partner with a larger pharmaceutical company.

1. PayPal Holdings, Inc. (NASDAQ:PYPL) 

Activist Investment: 2022
Long-Term Returns Since Singer’s Investment: -12%
S&P 500 Gain Since Singer’s Investment: 18%

PayPal Holdings, Inc. (NASDAQ:PYPL) operates a technology platform that enables digital payments for merchants and consumers. It provides financial solutions under PayPal, PayPal Credit, Braintree, Venmo, Xoom, PayPal Zettle, Hyperwallet, PayPal Honey, and Paidy names.

The activist investor confirmed a stake in the payment technology company in 2022. He also started discussing an agreement that would see him have a hand in determining the company’s future direction. Talks between the activist investor and were amicable.

Elliott Management also started pushing PayPal Holdings, Inc. (NASDAQ:PYPL) to speed up the cost reduction efforts when it was facing supply chain disruptions and once-in-a-generation inflation levels that had hindered e-commerce.

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