SCHEDULE: Kanen Wealth Management Shifts Allot Ltd. Stake to Passive

Kanen Wealth Management and affiliates have reclassified their 9.8% stake in Allot Ltd. to passive following the company's $40 million share repurchase authorization.

Summary

• Kanen Wealth Management, LLC and associated entities (Philotimo Fund, LP and Philotimo Focused Growth & Income Fund) now beneficially own 4,793,041 shares of Allot Ltd.
• This represents approximately 9.8% of the total outstanding shares as of March 6, 2026.
• The reporting persons have transitioned from an active engagement stance to a passive investment position.
• The shift in strategy follows Allot Ltd.'s announcement on June 23, 2026, regarding a $40 million share repurchase program.
• The group intends to file future reports on Schedule 13G rather than Schedule 13D.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as a neutral-to-positive development; the shift to passive status suggests the investor is satisfied with the company's current capital return strategy.

Positives

• The issuer has authorized a significant share repurchase program of up to $40 million, signaling management's confidence in the company's value.
• The reporting group views the shares as an attractive investment opportunity, having accumulated a substantial 9.8% stake.

Negatives

• David L. Kanen consented to an SEC cease-and-desist order on September 25, 2024, regarding past failures to timely file beneficial ownership reports, resulting in a $109,000 penalty.

Risks

• Future investment decisions remain subject to market conditions, the issuer's financial performance, and general economic factors.
• The reporting persons reserve the right to change their investment intent, which could involve future sales, purchases, or hedging activities.

Future Outlook

The reporting persons intend to maintain a passive investment stance and will transition to filing on Schedule 13G, though they reserve the right to adjust their position based on market conditions and the issuer's performance.

Management Comments

• The reporting persons stated they no longer hold securities with the purpose of influencing control following the issuer's share repurchase announcement.

Industry Context

StockSavvy.ai notes that the transition from active to passive status by a significant shareholder often signals alignment with management's current capital allocation strategy, particularly when a company initiates a substantial buyback program.

Comparison to Industry Standards

• The $40 million repurchase program is a significant capital return initiative for a company of Allot Ltd.'s market capitalization.
• The reporting group's 9.8% stake is a standard threshold for institutional investors to maintain significant influence without triggering full control-related regulatory burdens.

Legal Proceedings

• David L. Kanen settled an SEC administrative proceeding on September 25, 2024, regarding late filings of beneficial ownership reports, paying a $109,000 penalty.

Stakeholder Impact

• Shareholders may view the $40 million buyback as a positive signal for stock price support.
• The shift to passive status by a major holder reduces the likelihood of immediate activist-driven board or strategy changes.

Next Steps

• Transition to filing future reports on Schedule 13G.
• Continued monitoring of the issuer's financial and operational performance.

Key Dates

Recommendation

The company's commitment to a $40 million share repurchase program provides a floor for the stock price, but the transition of a major shareholder to passive status suggests a period of stability rather than immediate catalyst-driven growth.

Keywords

Allot Ltd, Kanen Wealth Management, Schedule 13D, Share Repurchase, Beneficial Ownership, Passive Investment