THS

JANA Partners and CEO Invest $12.7 Million in TreeHouse Foods ($THS) Following 40% Stock Plunge

05/12/2025 22:24

JANA Partners Management and the CEO have made a substantial investment of approximately $12.7 million in TreeHouse Foods ($THS). According to SEC filings submitted last week, activist investment firm JANA Partners purchased a total of 566,589 shares (worth about $12.66 million) over three days from May 8th to 12th, while simultaneously, $THS CEO Steven Oakland acquired 4,660 shares (approximately $100,000). TreeHouse Foods is America's largest private label food manufacturer, supplying various products such as cereals, snacks, and beverages to major retailers. With a market capitalization of approximately $1.15 billion, the company has been working to improve performance in a challenging market environment. This insider buying comes at a time when TreeHouse Foods' stock has declined approximately 40% over the past year. In mid-February 2025, the stock temporarily rebounded after fourth-quarter results exceeded expectations, but subsequently fell significantly throughout March and April. Year-to-date, the stock had dropped about 50% from its peak, with this substantial buying concentrated when shares were trading between $21-23. Notably, this insider buying occurred immediately following the May 6th announcement of first-quarter results. TreeHouse Foods reported earnings of 3 cents per share for the first quarter, significantly exceeding analysts' expectations of a 19-cent loss. Although revenue decreased by 3.5% year-over-year to $792 million, cost-cutting efforts appear to have contributed to improved profitability. The company announced a restructuring plan in April that includes eliminating approximately 150 positions and centralizing corporate functions. These cost-reduction measures were positively received following the earnings announcement, with the stock rising 8.9% on April 11th. According to Stifel's analysis, TreeHouse Foods has minimal exposure to tariff impacts as only 5% of its sales occur outside the United States. JANA Partners' investment carries strategic significance beyond mere share acquisition. Led by Barry Rosenstein, JANA Partners has a history of investing in various consumer goods companies and driving management changes. In 2018, they played a crucial role in the sale of Pinnacle Foods, and in 2021, they influenced Whole Foods' acquisition by Amazon. This investment in TreeHouse Foods suggests JANA Partners may take an active role in the company's restructuring and profitability improvement process. CEO Steven Oakland's personal investment is also noteworthy. Oakland has led TreeHouse Foods since 2018 and previously built over 20 years of experience at J.M. Smucker, making him a veteran in the consumer goods industry. A CEO purchasing company shares during challenging market conditions demonstrates strong confidence in the company's future. Upcoming events investors should monitor include the second-quarter earnings announcement and the effects of cost-cutting measures. Analysts are focusing on TreeHouse Foods' 2025 outlook, with annual adjusted net sales expected to range between $3.34 billion and $3.40 billion. While the food industry as a whole faces challenges from reduced consumer spending and cost pressures, TreeHouse Foods' private label products could be an attractive alternative for increasingly price-sensitive consumers. This presents a potential long-term opportunity for the company, though it faces short-term challenges from rising raw material costs and changes in distribution channels. In conclusion, the substantial purchases by JANA Partners and CEO Oakland signal strong confidence in TreeHouse Foods' value at current price levels. Combined with cost-cutting efforts, this insider confidence suggests potential performance improvements, though structural challenges in the food industry persist. Investors should pay close attention to upcoming quarterly results and management's strategic decisions.

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