Activist investor Engaged Capital just announced a stake in VF Corp

Engaged Capital just announced a stake in VF Corp (NYSE: VFC) – the company behind iconic brands like “The North Face” and “Vans”. Shares of the apparel and footwear company are up 12% at writing.

Here’s what Engaged Capital is pushing for at VF Corp

The activist investor wants VF Corp to cut $300 million in costs via “elimination of duplicative costs and corporate excess” – and is pushing for changes to its board as well.

Engaged is convinced that the changes it’s proposing could push shares of the Denver-headquartered firm to $46 (up 150% from here) over the next three years.

VF Corp is scheduled to report its quarterly financial results later this month. Consensus is for it earn 67 cents a share versus 73 cents per share a year ago.

Before this announcement today, “VFC” was down about 50% versus its year-to-date high.

Bullish flow in VF Corp ($VFC) today, with 20604 contracts trading and implied vol up 8.0 points to 71%. Shares near $17.91.

— Trade Alert (@OptionAlert) October 17, 2023

Engaged has confidence in the leadership of CEO Darrell

Engaged Capital did not reveal the size of its stake in VF Corp on Tuesday.

Underinvestment in Vans, not enough autonomy for individual brands, and the acquisition of “Supreme” were some of the reasons the activist investor cited in its presentation today for why the stock has underperformed in recent years.

While these strategic errors can be traced back to the former Chief Executive of VF Corp (Steve Rendle) who unexpectedly left the company in December of 2022 – Engaged did confirm that it has confidence in the “transformation experience” of the company’s current CEO (Bracken Darrell).  

Earlier this year, the activist investor targeted Shake Shack as Invezz reported here.