Activist hedge fund Starboard Value has increased its stake in Salesforce (CRM) by nearly 50% during the second quarter, according to a recent 13F filing. The fund now holds 1.25 million shares, up from 849,679 at the end of Q1. The move follows a sharp drop in Salesforce’s stock price and comes three years after Starboard helped push for changes at the company. Following the news, CRM stock was up 4% on Friday.
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Salesforce stock has dropped nearly 27% since January, which may have caught Starboard’s attention, especially since the fund often returns to companies it thinks are not sticking to their earlier goals.
Starboard Returns for Round Two at CRM
This increase in Starboard’s position has some investors wondering if CRM is heading back into the same activist battles it faced in 2022. During that period, Salesforce faced intense pressure from several activist investors, including Starboard, Third Point, ValueAct, and Elliott Management, to improve its margins and operational efficiency.
Many of these funds reduced or exited their positions by mid-2023 after Salesforce reported stronger results and made key leadership changes. Overall, the move signals renewed pressure on the company’s leadership and strategy.
Starboard’s Other Key Investments in Q2
The filing reveals that Starboard took a new position in online travel company TripAdvisor (TRIP), acquiring over 8.49 million shares. The fund also bought a stake in the iShares Russell 2000 ETF (IWM), purchasing 340,000 shares, indicating a bullish view on the small-cap market.
Moreover, the fund boosted its stake in Pfizer (PFE) by 10.5% to 8.5 million shares, less than a year after taking a $1 billion position and pushing for improvements at the pharmaceutical giant.
Is CRM a Buy, Sell, or Hold?
Turning to Wall Street, CRM stock has a Moderate Buy consensus rating based on 33 Buys, 10 Holds, and one Sell assigned in the last three months. At $349.43, the average Salesforce stock price target implies a 44.04% upside potential.
