This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Activists Fill Pantry with Full Proxy Slate

Stocks in this article: PTRY CASY SUSS GTY

The proxy fight has been nothing if not acrimonious. The activists have released letters bemoaning Pantry's underperformance compared to its competitors, while the company has defended its strategy saying, "It appears that they [the funds] are engaging in this proxy contest for the self-serving goal of gaining publicity for themselves and their newly formed hedge funds."

When the activist campaign launched, "All of these people [came] out of the woodwork," Eberwein said. "One guy who interviewed to be CEO said he so disliked the chairman that he didn't take the job."

Pantry has had four CEOs in the past five years.

The activists chose which incumbent directors they would pit their nominees against. Their prime target was the chairman of the board, whom they succeeded in ousting. "It's like in politics, when you take out the speaker of the house," Eberwein said.

Two of the activists' primary goals are convincing Pantry to install more quick-service restaurants in its convenience stores, a strategy that has been successful for its competitors, and paying down debt.

Pantry has high leverage compared to its competitors. Its debt-to-equity ratio stands at 292.2%, while convenience store operator Susser Holdings' (SUSS) ratio is 90.5% and Casey's General Stores' (CASY) is 120.9%, according to Bloomberg data.

When the activists brought up the possibility of creating a REIT to Pantry's management in December, "The CFO [Clyde Preslar] said: 'That's an interesting idea, I hadn't thought of that before. Maybe we'll look at that someday,' " Eberwein recounted.

But, the investor said, "The time to look at [the REIT option] is now."

2 of 4

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,912.56 +107.76 0.61%
S&P 500 2,074.10 +3.45 0.17%
NASDAQ 4,776.0120 +10.6320 0.22%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs