Photo Credit: Reservoir Media
Reservoir Media stock (NASDAQ: RSVR) is “substantially undervalued” – at least according to Irenic Capital Management, which owns about 8.1% of shares and is now demanding “a full strategic review.”
New York City-headquartered Irenic Capital just recently expressed that clear-cut position in a regulatory filing. According to the document, the signatory entity possesses just shy of 5.3 million Reservoir shares, 83,513 of which were purchased in either August or September.
For additional background, Irenic per its website “invests in public companies and works collaboratively with firm leadership.” The overarching aim of said collaborations “is to produce improvements in operating and financial performance that create long-term value for the company and its owners,” the same source indicates.
And as described by Reuters, Irenic isn’t a stranger to rattling the cage or to demanding strategic reviews in particular. To be sure, one such push reportedly came earlier in September, when the hedge fund formally called on Kinaxis, an Ottawa-based developer of supply-chain-management software, to kick off a review of its own.
Bringing the focus back to Reservoir Media, Irenic is of the belief that the Golnar Khosrowshahi-led business’s shares “are substantially undervalued,” the filing spells out.
Moreover, Irenic has encouraged Reservoir “to undertake a full strategic review of all alternatives to maximize shareholder value and to form a special committee of the Board to oversee such review process.”
DMN reached out to Reservoir for comment and received a brief response: “The Reservoir Media Board of Directors values shareholder input and we remain focused on executing our strategy to drive value, in line with our fiduciary duty to all shareholders.”
While that statement doesn’t provide concrete answers about how the situation will unfold, it’ll be worth monitoring the episode – and especially the stock-purchase moves of Irenic – in the coming weeks and months. (Among other things, Reservoir reappointed several board members at its annual stockholder meeting last month.)
Closer to the present, we don’t lack insight into the strategy and financials of Snoop Dogg-partnered Reservoir, which in April unveiled an up to $100 million offering to pay down debt and scoop up more music IP. Without rehashing the details at length here, we previously covered the company’s Q2 2024 revenue growth, which was fueled by publishing gains and arrived despite a dip on the recorded side.
Wrapping with a recap of RSVR’s recent performance, the stock’s value grew 3.6% during today’s trading to finish at $8.11 per share. That’s up 14.4% from 2024’s beginning and nearly 36% from late September of 2023, but less than half a percent from the top of April of 2024.
