Pitney-Bowes (PBI) gains as Hestia Capital takes activist stake, seeks changes

Shares of Pitney-Bowes (NYSE: PBI) are 3% higher in early trading Monday after Hestia Capital disclosed a 6.9% activist stake in a 13D filing with the SEC.

Hestia Capital, which is known for having made large gains in GameStop (NYSE: GME), views Pitney-Bowes' stock as undervalued and has privately engaged in talks with the company's management and its board of directors regarding capital allocation, improving operational performance, and making changes to the Board’s composition.

A source told Reuters that in addition to re-evaluating its capital allocation, Hestia wants the company to re-evaluate its e-commerce strategy. It has also suggested a possible sale of an underperforming segment.

Hestia sees shares of Pitney-Bowes trading between 70% and 80% below what its divisions would be worth on a standalone basis, sources added.

Hestia has suggested that the board consider selling the Global Ecommerce segment if its results do not improve. Also, the hedge fund said Pitney Bowes should focus on cash-generating segments like Presort Services, its mail aggregation business, and SendTech Solutions, its postage meter business.

Today's 13D from Hestia showed the fund started building its position in late September and has been buying in the mid-$2s to mid-$3s per share.

Pitney-Bowes has not responded to a request to comment.

By StreetInsider.com Staff

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