Shares of Wendy’s (WEN) are up 17% on May 12 as rumors swirl that activist investor Nelson Peltz wants to take the hamburger chain private.
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Multiple reports say that Peltz’s activist firm Trian Fund Management is looking for investor support to take Wendy’s private. Rumors of a take private deal are enough to send Wendy’s stock surging. The fast-food restaurant chain currently has a market capitalization of $1.5 billion.
Peltz, who stepped down as chairman of the Wendy’s board of directors in 2024, owns around 16% of the company’s shares, according to recent regulatory filings. His Trian co-founder, Peter May, also owns 16% of WEN stock, while Trian itself owns 8% of the iconic hamburger company.
Wendy’s Chromic Underperformance
Peltz has said multiple times that he is looking at ways to unlock value from Wendy’s, which has struggled with weak sales and tight profit margins. WEN stock has fallen 70% from a record high of $28.87 reached in June 2021.
Despite recent challenges, Wendy’s still has a recognizable brand, a big franchise model, and stable cash flow. Peltz signaled interest in taking over the struggling burger chain back in 2022. But the timing proved difficult in the midst of a then bear market. The media reports say now is more advantageous time for Peltz to try and take Wendy’s private.
Is WEN Stock a Buy?
Wendy’s stock has a consensus Hold rating among 20 Wall Street analysts. That rating is based on 15 Hold and five Sell recommendations issued in the last three months. The average WEN price target of $7.23 implies 9% downside from current levels.
