Starboard Value's Jeffrey Smith names 3 top stock picks, including TripAdvisor

Activist investor Jeffrey Smith of Starboard Value presented three new investment ideas at the 13D Monitor’s Active-Passive Investor Summit, targeting Bill Holdings, TripAdvisor, and Fluor Corp. Smith believes Bill Holdings is 50% undervalued with a profitability turnaround expected, noting Starboard's board representation. For TripAdvisor, where Starboard holds a 9% stake, he advocated for divesting its valuable non-core 'The Fork' unit to unlock shareholder value. Smith also highlighted Fluor Corp. as a key beneficiary of surging global power demand, citing its EPCM leadership and significant stake in NuScale Power, with Fluor management expressing openness to Starboard's engagement.

Analysis

Activist investor Jeffrey Smith of Starboard Value unveiled three new investment ideas—Bill Holdings (BILL), TripAdvisor (TRIP), and Fluor Corp. (FLR)—at the 13D Monitor’s Active-Passive Investor Summit, signaling a strongly positive outlook with a sentiment score of 0.8. Starboard's engagement, including a board seat at Bill Holdings and a 9% stake in TripAdvisor, suggests an active catalyst for potential value realization across these companies.

Smith asserts that Bill Holdings is trading at a 50% discount to its intrinsic value, anticipating a significant profitability turnaround following post-pandemic deceleration in its revenue streams. For TripAdvisor, Smith advocates for the divestiture of its non-core 'The Fork' unit, which boasts over 20% revenue growth and improving profitability, to unlock shareholder value from its strategically valuable assets.

Fluor Corp. is positioned as a key beneficiary of surging global power demand and accelerating infrastructure investment, recognized as one of two leading global EPCM players. The company's 39% ownership of NuScale Power (SMR), a developer of small modular nuclear reactors, further enhances its long-term growth profile, with Fluor management expressing openness to continued engagement with Starboard.

Key Decisions for Investors

• Investors should evaluate Bill Holdings for potential upside driven by Starboard's activist engagement and anticipated profitability improvements, considering the claimed 50% discount to intrinsic value.
• Monitor TripAdvisor for strategic actions regarding 'The Fork' divestiture, as this could unlock significant shareholder value given the unit's strong growth and profitability.
• Assess Fluor Corp.'s long-term growth trajectory, factoring in its EPCM leadership, exposure to global power demand, and its substantial stake in NuScale Power, while observing the impact of Starboard's influence.