Tripadvisor (TRIP) shares closed nearly 17% up on Thursday after Starboard Value announced a $160 million or 9% stake in the global travel platform, which it said was “undervalued” at current levels.
The activist investor hasn’t yet disclosed its plans for the firm, but its track record of successfully restructuring consumer-facing companies is already rekindling interest in TRIP shares.
Despite today’s rally, Tripadvisor stock is down some 6% versus its year-to-date high in February.
Starboard’s stake could prove meaningfully positive for TRIP shares because the activist investor’s standard playbook features pushing for operational improvements, cost discipline, and improved execution.
With these initiatives, the activist firm could help Tripadvisor’s flagship brand reclaim some of its lost ground in the second half of 2025 – following an 8% decline in revenue last year.
Meanwhile, Starboard could accelerate monetization of the company’s fast-growing units (Viator and TheFork) to boost shareholder value as well.
Simply put, the activist firm’s presence could lead to intense scrutiny of Tripadvisor’s operations and a push for tangible actions to unlock hidden value in the underperforming travel services firm.
In late June, Bernstein analysts also cited “undervaluation” as they recommended loading up on TRIP stock at current levels.
According to the investment firm, the company’s recent merger with Liberty Tripadvisor Holding removed a complex dual-share setup – effectively streamlining governance and making the firm more attractive to institutional investors and potential acquirers.
The 2024 transaction sparked interest from multiple parties, with some bids reportedly reaching as high as $30 per share.
Bernstein reiterated its “Buy” rating on Tripadvisor shares last week with a price objective of $20 indicating potential upside of another 15% from here.
Other Wall Street firms, however, are not nearly as positive on Tripadvisor stock despite perceived undervaluation.
