A sharp value creation strategy not only ensures that a great business is a great stock—but it also helps deter activist shareholder attacks.
A linear approach to strategy—first defining a business strategy, then developing a supporting financial strategy, and finally selling that package to investors—may seem logical, but it’s often not optimal.
The approach falls short because of the many interdependencies among business, financial, and investor strategies. Only by developing all three iteratively and in parallel—exploring multiple scenarios—can an organization maximize its total shareholder return (TSR).
Whether an organization is focused on creating value in business, justifying a high multiple, guarding against an activist shareholder attack, or overcoming a new activist campaign, our value creation consulting team has the relevant experience. In our value creation strategy work with clients, we:
Whether your organization is seeking to ignite a new wave of value creation, justify a high multiple, guard against an activist attack, or overcome a new activist campaign, BCG has the relevant experience. For example, we helped:
A North American soft-goods manufacturer understand why its market returns were below par despite strong fundamentals. The revised business, financial, and investor strategies we developed increased their TSR, price-to-earnings ratio, and stock price by 30% when compared with the market and the company’s peers.
A global logistics player break a cycle of underperformance and adopt value-based management practices that led to a new performance trajectory with TSR 10% above the market.
A major enterprise tech player prepare for and inoculate against a potential activist attack by analyzing an array of potential portfolio moves, cost reductions, and financial policy choices. The work led to two scenarios forecast to boost valuation by as much as 100%. The strategy ultimately outperformed by warding off an attack and leading to a doubling of the company’s share price within two years.
A leading global biopharma company respond decisively to a hostile takeover attempt by a competitor and an activist. Rapidly exploring strategic options, we helped the company develop a shareholder activism defense plan in six weeks to reduce costs by more than 15%, creating roughly $30 billion in incremental value and enabling the company to attract a white-knight acquirer.
Lifted by last year’s strong capital markets, the average annual total shareholder return surged across the companies in BCG’s Value Creators database.
Two decades of data show how leading distributors deliver strong shareholder returns. Distributors must generate local and national scale and fight to defend and grow their market share.
Our 25-year retrospective finds that long-term value creators excel by driving growth through innovation, differentiation, and self-disruption.
Exactly how the world will reach net zero is unknown, but at a macro level the science and economics define a pretty clear path. Given the magnitude of value at stake during the transition, many leaders are concluding that inaction may be the riskiest strategy of all.
What is the impact of the crisis on investors’ expectations for the US economy, the US stock market, and business leaders?
