Shares of British pest control services provider Rentokil Initial (NYSE:RTO) (GB:RTO) soared by nearly 12% in the premarket session today after Nelson Peltz’s Trian Fund Management built up a sizable stake in the company. Peltz’s Rentokil move comes fresh on the heels of Trian’s recent exit from Disney (NYSE:DIS).
Trian Takes a Shine to Rentokil
According to CNBC, Trian has amassed a top-10 position in Rentokil, which would peg the firm’s stake at over $400 million. Trian plans to engage with RTO’s top brass to boost value for the company’s shareholders.
Over the past year, RTO’s share price has tanked by nearly 33% amid lower demand in a post-pandemic world. Despite this decline, its market capitalization currently stands at roughly $13.3 billion.
Over the years, Trian has led activist investor campaigns at multiple consumer product-focused companies, including Unilever (NYSE:UL), Ferguson (NYSE:FERG), Proctor & Gamble (NYSE:PG), and Heinz (NASDAQ:KHC). However, Trian’s recent fight to gain representation on Disney’s Board did not succeed. In the aftermath, Trian disposed of its entire position in Disney. At one point, Trian was the fifth-largest shareholder in the company.
Is RTO Stock a Buy, Sell, or a Hold?
Trian’s campaign at Rentokil, though, is just beginning to take shape. Overall, the Street has a Moderate Buy consensus rating on Rentokil, alongside an average RTO price target of $35.
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