This activist has 3 stocks in its sights: Elanco Animal Health and Box Inc.

Article Excerpt

It generally pays to keep an eye on activist investors. Like us, they seek out companies that can boost share prices by selling or spinning off assets. Investment firm Starboard Value is now pressuring these three firms (including ACI, see box), but we see only two of them as buys. ELANCO ANIMAL HEALTH INC. $31 is a spinoff buy. This firm (New York symbol ELAN; Manufacturing sector; Shares outstanding: 472.8 million; Market cap: $14.7 billion; No dividend paid; Takeover Target Rating: Medium; www.elanco.com) makes medications for both livestock and companion animals (pets). Elanco was spun off by Eli Lilly (New York symbol LLY) in March 2019. Activist investor Starboard Value had now reportedly taken a stake in Elanco. The size of its holding hasn’t been disclosed. Starboard is the second activist to pressure Elanco recently. The company was targeted last year by Sachem Head Capital Management, which owns roughly 5.9% of outstanding shares. That hedge fund’s founder, Scott Ferguson, now sits on Elanco’s 13-person board of directors, having…