Swiss Watch Giant Gets Bullish as Activist Pushes for Change (1)

American activist investor Steven Wood’s one-man mission to overhaul the governance and culture of Swatch Group AG just became a lot harder.

The Swiss watchmaker and its plain-talking, cigar-smoking Chief Executive Officer, Nick Hayek, may have spent most of the past two years disappointing shareholders with tumbling sales and shrinking profits, but last month they surprised with an upbeat outlook and bullish predictions of a recovery this year.

The market reaction was dramatic. The company’s shares — the most shorted in Europe — had their best day ever, and are up 15% this year.

It was a timely riposte from Hayek, ...