Legendary Investor Just Bought $3.2 Billion of AT&T Inc.
If you want to make a lot of money in the stock market, it pays to follow this type of investor: shareholder activists.
Shareholder activists fight for changes at poorly managed
companies. They can pressure firms on anything from dividend hikes and asset
spin-offs to throwing out under-performing executives. And as we have pointed
out in situations like Nestle SA (ADR) (OTCMKTS:NSRGY, SWX:NESN) and Whole
Foods Market, Inc., that can serve as a catalyst for explosive returns.
In the crosshairs today: AT&T Inc. (NYSE:T). On September
9, billionaire Paul Singer disclosed a $3.2-billion stake in the company. And
in an open letter to AT&T’s board of directors, the hedge fund honcho
chastised Chief Executive Officer Randall Stephenson’s track record and he
proposed options to unlock value. (Source: “A Letter to AT&T,” Activating
AT&T, September 9, 2019.)
Admittedly, Mr. Stephenson has made some smart calls. In
2007, just after taking on the top job, he bet big on wireless to fuel
AT&T’s growth. By signing an exclusivity deal with Apple Inc.
(NASDAQ:AAPL), the company exploited the “iPhone” to gain market share.
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