Daily Recap: SOLV, TATE/INGR, GNK/DSX, DXCM, SHOP, FRMI, PZZA, STRZ

Research evidence excerpt

Daily Recap: SOLV, TATE/INGR, GNK/DSX, DXCM, SHOP, FRMI, PZZA, STRZ

Quick Note

May 15, 2026 SPECIAL SITUATIONS

Daily Recap: SOLV, TATE/INGR, GNK/DSX, DXCM, SHOP, FRMI,

Analysts PZZA, STRZ

Michael Piccolo

212-668-9863

michael.piccolo@wedbush.com

Solventum Corp. (SOLV - $74.42)

Solving for the Conglomerate Discount with Momentum; Mike Piccolo Initiates

at OUTPERFORM. Spun off from 3M in Apr’24, Solventum has underperformed

expectations during its early standalone tenure, with adj. EBIT compressing ~480

basis points from pre-spin levels. However, we believe the stock’s current ~9.6x EV/

EBITDA multiple materially undervalues a portfolio of market-leading franchises

across MedSurg (MS), Dental Solutions (DS), and Health Info Systems (HIS), each

of which commands premium positions in their respective peer groups. With

activist investor Trian (~5% stake) escalating its campaign by demanding immediate

portfolio simplification, the company’s "Transform for the Future" restructuring

program targeting 23%-25% EBIT margins by FY’28, the successful $4 billion

Purification & Filtration (P&F) divestiture demonstrating management's willingness

to act, and over 40% of transition service agreements (TSAs) already exited, we see

a convergence of catalysts that should drive meaningful valuation re-rating over

the next 12-18 months. We are initiating coverage on SOLV with an OUTPERFORM

rating and a $94 price target as we believe shares represent a compelling, multi-

catalyst special situation offering asymmetric upside potential. (Full Report)

TRADING VIEW: For investors seeking exposure to a differentiated MedTech

portfolio with identifiable near-term catalysts, activist accountability, and a clear

path from conglomerate discount to pure-play re-rating, we believe Solventum