Nielsen shares finished Monday’s trading up an impressive 12% on more than six-times the amount of volume it normally sees in a trading session. On Tuesday, shares were up another 5.9%, bringing NLSN to trading levels not seen since a July 25 tumble.
What’s fueling a much-needed rebound in Nielsen’s stock price, following a Q2 2018 earnings miss, a cut of its profit forecasts, and the announcement that CEO Mitch Barns would retire at the end of the year?
It appears that an activist investor holding more than 8% of the company’s outstanding shares has called on Nielsen to put itself up for sale.
An Aug. 10 filing with the SEC indicates that New York-based Elliott Management Corp. and its sole managing member, Paul E. Singer, on July 26 swooped in to acquire more shares in the nation’s dominant audience measurement and data analytics company.
As such, Elliott now holds some 30 million Nielsen shares, constituting approximately 8.4% of the outstanding common stock.
The value of this stake is approximately $660 million.
Singer then spoke with The Wall Street Report over the weekend by calling on Nielsen to sell not just its “Buy” segment, which has been a drag on company revenue for several quarters, but to put the entire company on the block.
The “Buy” segment performance is a primary reason for his calls for a full sale of Nielsen, saying the division has “failed to keep up with competitors.” They include GfK IRI and NPD Group.
CNBC reported on Elliott’s investment at 2:15pm Eastern; this led to a further spike in share value, helping Nielsen shares finish on Monday at $24.62 — good for a $2.64 gain from Friday’s close. Volume was 29.78 million shares; normal trading volume is 4.72 million shares.
With Tuesday’s Closing Bell, Nielsen shares enter Wednesday’s trading session at $26.05.
That’s roughly $5 less than where shares were on July 13.