Activist investor Starboard announces stake in Salesforce, sees significant opportunity

Jeffrey Smith, CEO of Starboard Value LP and Papa John’s International Inc.

Brendan McDermid | Reuters

Starboard Value LP takes stock sales team, According to CNBC’s David Faber, founder Jeff Smith says an important opportunity remains at the enterprise software manufacturer.

Dow component Salesforce rose 7% in premarket trading on Tuesday.

Shares of Salesforce have dropped more than 40% this year. In August, the company gave a disappointing forecast for fiscal 2023, in part due to the negative foreign exchange impact.

Smith told Faber that the stock was substantial, without specifying the dollar amount.

The hedge fund manager said the valuation cut in Salesforce shares is currently largely due to “a below-average mix of growth and profitability.” Smith added that the software company has not created meaningful operating leverage relative to its peers in recent years.

Smith remained a prolific activist investor even during the pandemic, calling for change at Humana, Kohl’s, Mercury Systems, and others.

The Starboard CEO will be on CNBC at 10:15 pm ET to talk more about the new stock.

Starboard Value manages nearly $6.2 billion in assets, according to filings through the first quarter of 2020.


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