Double check if the stock you own has an activist eyeing changes. We need to be sure that the company is not enduring a period of changed leadership brought on by Activist (Dan Loeb and Third Point) interests and share purchases of Colgate Palmolive. From Reuters
October 18, 2022
Third Point takes stake in Colgate-Palmolive, urges pet food spinoff
By Svea Herbst-Bayliss and Uday Sampath Kumar

“With inflation rising at a sharp pace, Loeb said the Colgate investment makes sense because the business is “defensive” and has the ability to raise prices.”

“We see shares compounding at a mid to high teens rate over the next several years just from earnings growth and the nearly 3% dividend,” Loeb wrote, adding that any strategic actions around Hill’s or the consumer health sector “could add materially to our expected return.”

While Loeb sounded a positive note on Colgate’s portfolio, he also noted that earnings growth has been disappointing and that the stock price has underperformed.

He called on the board to take action at a time of increased activity in the consumer health sector. “Although the Board is fairly long-tenured and not known for making bold moves, we are confident that it will act in the best interests of shareholders if Colgate becomes part of the current M&A minuet in consumer health,” he wrote.

Third Point, which invests in a variety of strategies including activism, has previously pushed big-name companies, including Walt Disney and Shell to consider changes, including refreshing its board.

While this can be a good thing it can also be a not so good thing when activist investors gain a foothold and start suggesting or insisting upon changes. It is good to know if your holdings have a activist investor with enough stock shares to implement changes and if you are happy with the way the company is run you may think twice about where you want to continue to hold the stock because you may prefer to keep things the way the are. Additionally in some cases of activist investors whole companies can be split up with sectors within the company sold off or spun off, think what occurred to Sears and Bed Bath and Beyond which is now in bankruptcy and Sears which was completely closed down.

With investing, it is just as important to know what your buying as to know when big changes are about to occur in your holdings due to activist investors. STAY TUNED TO REAL HOT STOCK TIPS to be kept abreast of changes.