Technology companies are increasingly in activist investors’ crosshairs. But on average, the target companies’ share prices have little to show for it.
Of the thirteen most high-profile battles between technology companies and activist hedge funds over the past two years, only six of the target companies saw their shares rise more than the Standard & Poor’s 500 Index.
Some of those that outperformed: Yahoo and Microsoft. The first was targeted by Daniel Loeb in September 2011. Its shares have jumped about 160% since he bought the stock as investors expect that Alibaba Holdings, an Asian e-commerce company in which Yahoo holds a stake, will soon go public. Shares of Microsoft, which stagnated until CEO Steve Ballmer announced he was stepping down last year, are up about 20% since last April when hedge fund ValueAct Capital began agitating for a board seat.