Activist hedge fund Clinton Group discloses an expanded 5.3% stake (1.48M shares) stake in Nutrisystem.
In conjunction, the fund sent a letter to CEO Dawn Zier, lauding the company on its CEO change (which Clinton had agitated for) and urging the company to increase the dividend (current yield of 4.9%) as cash flow improves. Clinton cites Citigroup research that projects Nutrisystem will have enough FCF by 2014 to hike the dividend by 50%.
Clinton believes the stock’s value will be in the mid-$30s by 2015 as the company once again realizes a successful turnaround and the market takes note.