Bill Holdings (BILL) stock rose over 6% in after-hours trading on Tuesday after Elliott Management, a well-known activist hedge fund, acquired a stake of at least 5% in the financial automation software company, according to the Financial Times. The move makes Elliott one of Bill’s top five investors, adding further pressure on management.
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Just last week, activist fund Starboard Value disclosed an 8.5% stake in the company and said it plans to nominate four directors to Bill’s board.
Stock Down Sharply From 2021 Highs
Bill Holdings once traded at a market value of $34 billion during the fintech boom in 2021. But the stock has since lost about 85% of its value, leaving the company with a market cap of just $5.2 billion.
The company processes more than $300 billion in payments each year and has been trying to expand into larger customers to stabilize revenue. It also launched a $300 million buyback program and holds more than $400 million in net cash, which could support more repurchases.
Takeover Talk Builds
With valuations down across the payments sector, many investors see Bill Holdings as a potential takeover target. Rival firms have already drawn private equity interest, with Thoma Bravo taking Coupa private in an $8 billion transaction, TPG acquiring AvidXchange for $2.2 billion, and Melio sold earlier this year for up to $3 billion.
Elliott itself has a track record of pushing companies toward strategic deals. Its private equity arm has previously built positions in listed tech firms like Nielsen and Citrix before supporting buyout offers. That history is fueling speculation that Bill could attract similar interest, either from Elliott directly or from other bidders encouraged by the activist’s involvement.
What’s Next for Investors
Elliott has not yet outlined its demands, but its presence, alongside Starboard’s, puts new pressure on Bill’s management.
After steep stock losses, activists may push for faster changes, a sale, or more buybacks. For now, the news of Elliott’s stake has lifted shares, but investors will be watching for the next move in what could become a high-stakes activist battle.
Is BILL a Good Stock to Buy?
Overall, Wall Street has a Moderate Buy consensus rating on Bill Holdings stock based on nine Buys and 10 Holds. The average BILL stock price target of $56.67 indicates 11.29% upside potential.
