What happened
Shares of Trivago N.V. (TRVG) moved higher last month after the struggling hotel-booking platform got a boost from a private-equity investor. According to data from S&P Global Market Intelligence, the stock finished September up 27.5%.
As you can see from the chart below, the gains came in a surge in the middle of the month when news broke of the investment.
So what
Trivago stock jumped 14% on Sept. 19 after PAR Investment Partners bought 7 million Trivago shares from insiders for $4.47 in a private transaction, taking a 5% stake in the hotel-booking specialist. PAR was already Trivago's largest institutional shareholder, and the increased stake seems to indicate that the private-equity firm may be interested in taking an activist position in Trivago, or that it believes shares have bottomed out after a long slide over the past year.
Image source: Trivago.
Activist investors generally disclose themselves as such after taking a stake in the target company, seeking to persuade management of their goals or to drum up support from other shareholders for their initiatives. PAR has not yet done this, so it seems like for now the private-equity firm is just a passive investor.
Now what
It's not a surprising that Trivago would get some attention from institutional investors. Even after last month's gains, the stock is still down 49% over the past year as revenue growth has suddenly slowed and the company has struggled to turn a profit. Management has indicated it expects performance to improve in the second half of the year.
