Cognizant Technology (NASDAQ: CTSH) experienced a 2% increase in its stock price amid rumors about an activist investor taking a stake in the company. Recently, Nomura, a Japanese bank, purchased 13.3 million shares of Cognizant during the first quarter of this year, according to their 13F filing. This acquisition has given Nomura a 2.75% stake in the company, making it the seventh-largest shareholder of Cognizant.
Nomura is known for being a counterparty for activist swap positions and has a history of putting activists into stocks. One such activist, Elliott Management, has had previous involvement with Cognizant since 2016 when they owned a stake in the company and wrote a letter to management indicating potential interest in influencing the company’s direction.
Analysts believe that Cognizant may be a target for activism due to its weaker performance compared to its peer company Accenture (ACN), which has shown stronger results in recent years. The emergence of Nomura as a significant shareholder increases speculation about potential activist involvement in the company’s future direction.