Shares of Salesforce (NYSE: CRM) were up in pre-market trading on Tuesday after activist investor, Starboard Value took a stake in the cloud-based software company, according to a CNBC report.
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Starboard’s founder Jeff Smith told CNBC that “a significant opportunity” existed in the company and that Starboard had taken a significant stake.
Shares of CRM have dropped 42.4% this year and Smith believes that this valuation discount in CRM shares is due to a “sub-par mix of growth and profitability,” according to the report.
Hedge funds have upped their holdings in CRM by 3.9 million shares in the past three months, and overall the hedge fund signal is very positive about the stock.
