Investing.com – Dollar Tree led consumer discretionary stocks higher on Monday as Starboard Value took a stake in the retailer and touted changes aimed at improving performance.
Activist Investor Starboard Value acquired a 1.7% interest in Dollar Tree (NASDAQ:DLTR) worth about $370 million and is seeking majority control of the company's board in a bid to force strategic improvements, it said in a letter to shareholders. Dollar Tree's shares rallied more than 6%.
Starboard touted two areas of Dollar Tree, in which it was looking to unlock value: A possible sale of the underperforming Family Dollar business and a tweak to Dollar Tree's pricing model.
Analysts at Buckingham Research said the announcement "will, at a minimum, put a floor on the stock," and added that "value creation and improving performance are likely outcomes (for Dollar Tree) over the intermediate future."
Amazon.com (NASDAQ:AMZN) also enjoyed a positive assessment from Wall Street as Pivotal Research Group piqued investor interest after slapping a $1,920 price target on the company's shares, about 18% above the stock's current level.
The research firm said Amazon will continue to gain market share in the consumer market, which totalled $45 trillion in 2018, according to Euromonitor.
Pivotal did, however, express cautioned somewhat over the e-commerce giant's retail business, citing potential risks owing to "the relative maturity of e-commerce and likelihood that consumer spending trends would probably have a negative impact on the company in a way they didn’t during the last recession.
Toy company Mattel (NASDAQ:MAT), meanwhile, surged 9% after it inked a partnership with international K-pop boy band BTS.
Under the partnership, which includes BTS' label Big Hit Entertainment, Mattel will create a toy line including dolls of the seven-member K-Pop band, with the collection due to roll out in the summer.