Tiffany & Co. (NYSE: TIF) shares may be well off or their 52-week highs but that isn’t discouraging one large activist investor from building up a sizable stake and banking on a turnaround. Shares in the jeweler rose almost 3 percent today after Nelson Peltz’s Trian Fund Management raised its stake in Tiffany from 5.54% to 7.9%. Shareholders are hoping that the activist investor can take action to help the company turn itself around and restore confidence.

Nelson Peltz is well known for his involvement in companies like Wendy’s International (NYSE: WEN) and H.J. Heinz (NYSE: HNZ), which rose 38% and 22% respectively since his involvement. In both instances, he took actions designed to unlock value by shedding certain business units and improving operating efficiency. Many are hoping that the activist can do the same for Tiffany’s, which has been struggling in a tough retail environment with sinking margins.

Tiffany’s recently announced overseas sales that were more robust than domestic sales with an 18% increase in net income in Europe and a 30% increase in Asian-Pacific countries. However, these numbers failed to impress the market who were looking for something more – shares plunged from around $40 per share to below $34 per share earlier this week.

In the end, Tiffany’s is a stock that is clearly in need of some help. Nelson Peltz is well known for taking action to unlock hidden value within companies and many shareholders are hoping that he will do the same for this company and help shareholders turn around their investments in the company. Combined, these factors make TIF a stock worth watching!

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ISIS Pharmaceuticals (NDAQ: ISIS) has the attention of analysts but is having trouble attracting a good valuation from investors. Jefferies Research reiterated their $30 price target for the pharmaceutical company, saying a number of near-term catalysts should drive share appreciation. Meanwhile, the company’s chief executive came out early this week saying that the street was grossly undervaluing the Genzyme Corporation (NDAQ: GENZ) deal they recently inked on Monday. So, do shareholders have it wrong?

There are several catalysts that could set ISIS shares soaring. Recently, the company has been exploring strategic alternatives for its Ibis Biosciences division and some believe that a partnership with a substantial upfront payment, spin-off, or sale could materialize sooner than the street expects. This could prove to be a windfall for the company’s shareholders if it went through at attractive pricing.

ISIS is also expecting to commence its Mipomersen P3 heterozygous FH (HeFH) trials shortly. Analysts believe that one of the key points with the FDA centers around finalizing the most appropriate definition of a HeFH patient. Meanwhile, physicians have reported expressed a large degree of comfort with all the mipomersen data presented so far in the process. Consequently, there are no major road-blocks seen the P3 trails in the broader FH population. Obviously, news of this could send shares much higher.

Finally, ISIS’ recent deal with Genzyme only managed to return about 16% now since the announcement despite an early pop in the share price. The deal to license ISIS’ experimental cholesterol fighter could result in more than $1.5 billion in milestone payments and a 50% share of profits from the medicine. Considering that ISIS’ market capitalization stands right around $1.5 billion alone, this could definitely prove to be a windfall if everything goes as planned.

In the end, there are many things that could jump ISIS’ share price over the short and medium terms. However, as with most pharmaceutical companies, there is no guarantee that anything happens. Often times, you just have to play the odds. If nothing else, this is an interesting stock that is definitely worth watching over the next few weeks and months!

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Retailers have taken a beating recently with weak consumer spending amid tough competition. Many names like Target Corporation (NYSE: TGT) and Sears Holding Corporation (NYSE: SHLD) are generating substantial losses for otherwise great investors. So, are these simply bad apples in their portfolios or should we expect to see a turnaround in the retail sector over the next few years.

Target has quickly become one of the most compelling stories on Wall Street today. The retailer saw its stock drop nearly half from it’s 52-week high of $70 per share. Billionaire William Ackman felt this drop in his own portfolio of leveraged Target stock. The activist investor, known for his 20%+ annual returns, took a huge hit on the stock (but was still able to return a rumored 23% last year). However, the activist hasn’t been selling. In fact, he recently increased his economic ownership to over 10% and is considering a new fund exclusively to invest in Target.

Bill Ackman believes that Target stock is worth $120 a share over the next three years. The value – in his eyes – is hidden within the company’s real estate and consumer credit divisions – both hindered by the current crisis. He argued that the company should complete a previously announced $10 billion share buyback, sell its $8 billion in credit card loans, and extract cash through its sizable real estate holdings. In fact, the activist estimates Target’s real estate worth as $42 billion – the same as its market cap!

Eddie Lampert is another well-known activist investor that took a large position in Sears before the consumer credit and subprime crisis hit the street. Like Ackman, Lampert saw his Sears investment nearly cut in half and there is no indication that the pain is over. However, this situation is a little different in that Lampert is actually CEO of Sears. The activist took over after pushing for the merger with Kmart that pushed shares above the $100 level for the first time.

Initially, Lampert planned to milk the retailers’ cash flows in order to fund other investments – similar to the his idol did with Berkshire Hathaway in the early days. However, plans are now changing as the retailer has failed to produce rising same-store sales for several months. Now, the plan may be to leverage its portfolio of valuable brands and real estate and break up the company to unlock value. Many argue that a spin-off of Kenmore or Craftsman could generate extra cash that could be used to fund more profitable acquisitions. Meanwhile, real estate assets could also be leveraged but this may not be the best time to do it.

In the end, these are two of Wall Street’s best investors that have found themselves stuck in losing stocks. The lesson is that intrinsic value is not always equal to market value; the market can undervalue a company long enough for its intrinsic value to fall. Declining consumer spending, consumer credit and real estate prices may put a wrench in these strategies. However, both are interesting stocks that are worth watching in case the activists are able to successfully effect change!

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