Shares of AT&T spiked as much as 8% early Monday after Elliott Management announced a $3.2 billion stake in the company.
The activist hedge fund said in a letter to AT&T’s board of directors that the has a “compelling value-creation opportunity,” and that it predicts shares could rise past $60 by the end of 2021. That would be a roughly 50% increase over current levels.
Elliott’s letter proposes a plan called “Activating AT&T,” which focuses on improving operational efficiency, honing strategic focus, and applying a formal capital allocation framework.
The firm also said “AT&T shareholder returns have been disappointing over a prolonged period.”
Watch AT&T trade live.
AT&T’s stock price spiked 8% on Monday morning after Elliott Management — one of the largest activist investors in the world — revealed a $3.2 billion stake in the company.
Elliott said in a letter to AT&T’s board of directors on Monday that it believes the company has a “compelling value-creation opportunity,” and that it expects shares could reach more than $60 by the end of 2021. That would be a roughly 50% increase over current levels.
“There is a great deal at stake in ensuring that AT&T realizes its potential — for shareholders, for consumers, for employees, and even for the US as a global telecom leader,” Elliott said.
The letter proposes a four-part plan dubbed “Activating AT&T” which includes improving the company’s operational efficiency, strategic focus, and applying a capital allocation framework.
Markets Insider is looking for a panel of millennial investors. If you’re active in the markets, CLICK HERE to sign up.
Elliott also said “AT&T shareholder returns have been disappointing over a prolonged period,” citing company’s M&A as the primary culprit. The telecommunications company shelled out more than $100 billion for Time Warner in 2016, and …read more
Source:: Business Insider