This Firm Sold $48 Million in Primo Brands Stock Amid Post-Acqusition Leadership Shake-Up

New York-based Seven Grand Managers cut its stake in Primo Brands Corporation (NYSE:PRMB) by an estimated $48.2 million in the third quarter, according to an SEC filing on Wednesday.

What Happened

According to an SEC filing on Wednesday, Seven Grand Managers sold 1.5 million shares of Primo Brands Corporation (NYSE:PRMB) during the third quarter. The transaction value was approximately $48.2 million, and the fund reported still holding 500,000 shares worth $11.1 million at the end of September. The trade represented 3.2% of the fund’s $1.2 billion reportable U.S. equity assets.

What Else to Know

This was a substantial reduction: The holding now accounts for just 0.9% of 13F AUM, compared to 7% in the prior quarter.

Top five holdings after the filing:

• NASDAQ:GLXY: $67.6 million (5.5% of AUM)
• NASDAQ:TMUS: $47.9 million (3.9% of AUM)
• NYSE:MCK: $46.4 million (3.8% of AUM)
• NASDAQ:KTOS: $45.7 million (3.7% of AUM)
• NASDAQ:NDAQ: $44.2 million (3.6% of AUM)

As of Thursday's market close, Primo shares were priced at $16.31, down about 42% over the past year and significantly underperforming the S&P 500's 13% gain in the same period.

Company Overview

Company Snapshot

Primo Brands Corporation is a leading provider of bottled water and water filtration solutions, operating at scale with a diverse brand portfolio, including premium spring water, sparkling and flavored water, mineral water, water dispensers, filtration equipment, and coffee products under multiple brands. The company leverages a direct-to-consumer distribution model and a broad service offering to address hydration needs across multiple customer segments. Its strategic focus on recurring revenue streams and established brand recognition supports its competitive position in the non-alcoholic beverage industry.

Foolish Take

Seven Grand's sharp reduction in Primo Brands Corporation signals a decisive shift away from a once-core holding that has struggled to regain investor confidence. The New York-based fund sold 1.5 million shares during the third quarter, leaving 500,000 shares worth about $11.1 million—a steep drop from the prior quarter, when Primo made up 7% of its portfolio. The sale follows a period of turbulence for the beverage group, whose shares have fallen 42% in the past year despite revenue growth tied to its 2024 merger between Primo Water and BlueTriton Brands.

In its latest results, Primo reported net sales of nearly $1.8 billion, up 35% year over year, and a 53% jump in adjusted EBITDA to $404.5 million, signaling progress on merger synergies and premium-brand expansion. However, rising costs and integration expenses weighed on profitability, with net income down 24% to $40.5 million. The company also announced a leadership change, appointing board member Eric Foss as CEO.

The move comes as Seven Grand lifted its exposure to digital assets through a purchase of Galaxy Digital shares in the same quarter. So what should long-term investors take away? Primo’s fundamentals remain sound, but execution and cost discipline will determine whether a post-merger turnaround helps shares recoup losses.

Glossary

13F reportable AUM: Assets under management in U.S. equities that must be disclosed in quarterly SEC Form 13F filings.
AUM (Assets Under Management): The total market value of investments managed on behalf of clients by a fund or firm.
Dividend yield: Annual dividends paid by a company as a percentage of its share price.
Five-year revenue CAGR: Compound annual growth rate of a company's revenue over the past five years.
Direct-to-consumer: A business model where products are sold directly to end customers, bypassing third-party retailers.
Self-service refill stations: Locations where customers can fill their own containers with products, often water, for a fee.
Recurring revenue streams: Predictable, ongoing income generated from repeat sales or subscriptions.
Top five holdings: The five largest investments in a fund's portfolio, typically ranked by market value.
TTM: The 12-month period ending with the most recent quarterly report.
Underperforming the S&P 500: Achieving a lower return than the S&P 500 index over a given period.
Reportable U.S. equity assets: U.S. stock holdings that must be disclosed in regulatory filings.
Brand portfolio: The collection of different brands owned and managed by a single company.

Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool recommends McKesson, Nasdaq, and T-Mobile US. The Motley Fool has a disclosure policy.