• Wed. May 29th, 2024

Nomura Becomes Largest Shareholder of Cognizant, Fueling Speculation about Activist Involvement

BySamantha Jones

May 16, 2024
Cognizant Technology stock rises amid speculation of activist investor following 13F filing

Cognizant Technology (NASDAQ: CTSH) experienced a 2% increase in its stock price recently, sparking speculation about an activist investor taking a stake in the company. The Japanese bank Nomura has been rumored to be the potential activist investor after purchasing 13.3 million shares of Cognizant in the first quarter of this year, according to their 13F filing. This acquisition gives Nomura a 2.75% stake in the company, making it the seventh-largest shareholder of Cognizant.

Nomura is known for being a counterparty for activist swap positions and has a history of putting activists into stocks. One such activist, Elliott Management, has had previous involvement with Cognizant, owning a stake in the company since 2016. They also wrote a letter to management at that time, indicating potential interest in influencing the company’s direction.

The emergence of Nomura as a significant shareholder in Cognizant increases speculation about potential activist involvement in the company’s future direction. Analysts believe that Cognizant may be a target for activism, especially when compared to its peer company Accenture (ACN), which has shown stronger performance in recent years.

Activist investors are typically interested in companies that they believe have undervalued assets or underperforming operations. In this case, analysts suggest that Cognizant’s weak financial performance could make it an attractive target for an activist investor like Nomura.

Elliott Management’s previous involvement with Cognizant raises questions about their possible role in any future activism efforts at the company. However, it remains unclear whether Elliott Management will participate actively or remain passive as Nomura takes control of their stake.

In conclusion, while there is no certainty about whether an activist investor will take over Cognizant or not, Nomura’s recent purchase of shares and their history of putting activists into stocks suggests that there is potential for such activity. Investors should keep an eye on any developments related to this situation and seek professional advice before making investment decisions.

By Samantha Jones

As a content writer at newsnnk.com, I weave words into captivating stories that inform and engage our readers. With a passion for storytelling and an eye for detail, I strive to deliver high-quality and engaging content that resonates with our audience. From breaking news to thought-provoking features, I am dedicated to providing informative and compelling articles that keep our readers informed and entertained. Join me on this journey as we explore the world through the power of words.

Leave a Reply