Key Takeaways
- • Starboard Value fully exited Salesforce and Autodesk positions in Q1 2026 (disclosed via 13F filing May 15, 2026) after three-year activist campaign successfully drove margin expansion, resulting in Salesforce's $25 billion accelerated share repurchase and EPS beat of $3.88 versus $3.13 consensus.
- • Jeff Smith's hedge fund simultaneously initiated new long positions in Lamb Weston (frozen potatoes) and CarMax (used cars)—both distressed consumer-economy names—while adding to existing stakes in Riot Platforms and TripAdvisor, signaling strategic pivot from software activism to turnaround plays.
- • Lamb Weston trades at 13x forward P/E with $250+ million cost-reduction target by FY28; stock down 46% over five years but posted third consecutive earnings beat (Q3 FY26 adjusted EPS of $0.72 versus $0.61 consensus) and raised full-year sales guidance to $6.45–$6.55 billion.
- • CarMax shares down 56% over five years, representing deeper distress positioning that aligns with Starboard's pattern of targeting undervalued, restructuring-stage assets where activist leverage can drive operational improvement.
- • Timing suggests Smith exited Salesforce before accelerating software sector valuation reset; CRM down approximately 35% year-to-date as of reporting, indicating strategic exit preceding broader market repricing.
Summary
Starboard Value, the activist hedge fund led by Jeff Smith, has executed a significant portfolio reorientation in early 2026, exiting long-held positions in two enterprise software companies and rotating capital into distressed consumer-facing businesses. According to the fund's 13F filing disclosed on May 15, 2026, Starboard fully liquidated its stakes in Salesforce (NYSE: CRM) and Autodesk (NASDAQ: ADSK) during the first quarter while simultaneously opening new positions in Lamb Weston Holdings (NYSE: LW) and CarMax (NYSE: KMX). The fund also expanded existing holdings in Riot Platforms and TripAdvisor.
The exit from Salesforce marks the conclusion of a three-year activist campaign that commenced in late 2022. Starboard's intervention pushed Salesforce Chief Executive Marc Benioff toward disciplined margin expansion and operational efficiency. The thesis delivered measurable results: Salesforce reported Q1 FY27 earnings per share of $3.88, exceeding consensus estimates of $3.13, and announced a $25 billion accelerated share repurchase program that reduced diluted share count from 970 million to 871 million shares. Smith's timing proved advantageous, as Salesforce shares have declined approximately 35% year-to-date, suggesting the activist trimmed positions ahead of the broader software sector valuation repricing now underway across the technology industry.
The pivot into Lamb Weston and CarMax represents a striking tactical shift—from enterprise software activism to restructuring plays in the consumer economy. Lamb Weston, a frozen potato products company, fits the classic Starboard profile: shares have declined 46% over five years, the stock trades at a forward price-to-earnings multiple of 13x, and the company is mid-restructuring. Under its "Focus to Win" initiative, Lamb Weston targets more than $250 million in cost savings by fiscal year-end 2028. Operational momentum is building: the company posted Q3 FY26 adjusted earnings per share of $0.72 versus consensus of $0.61—its third consecutive beat—and raised full-year fiscal 2026 net sales guidance to a range of $6.45–$6.55 billion. However, profitability remains compressed; GAAP net income fell 63% year-over-year due to restructuring charges and a raw potato inventory write-off.
CarMax represents an even more distressed opportunity, with shares down 56% over the past five years. The entry into both positions suggests Smith views these as turnaround candidates where activist engagement and operational discipline can unlock shareholder value in deeply out-of-favor corners of the consumer economy. This rotation underscores Starboard's flexibility in shifting from high-multiple software names toward lower-multiple, operationally challenged businesses where the fund's activism model historically has proven effective.
The exit from Salesforce marks the conclusion of a three-year activist campaign that commenced in late 2022. Starboard's intervention pushed Salesforce Chief Executive Marc Benioff toward disciplined margin expansion and operational efficiency. The thesis delivered measurable results: Salesforce reported Q1 FY27 earnings per share of $3.88, exceeding consensus estimates of $3.13, and announced a $25 billion accelerated share repurchase program that reduced diluted share count from 970 million to 871 million shares. Smith's timing proved advantageous, as Salesforce shares have declined approximately 35% year-to-date, suggesting the activist trimmed positions ahead of the broader software sector valuation repricing now underway across the technology industry.
The pivot into Lamb Weston and CarMax represents a striking tactical shift—from enterprise software activism to restructuring plays in the consumer economy. Lamb Weston, a frozen potato products company, fits the classic Starboard profile: shares have declined 46% over five years, the stock trades at a forward price-to-earnings multiple of 13x, and the company is mid-restructuring. Under its "Focus to Win" initiative, Lamb Weston targets more than $250 million in cost savings by fiscal year-end 2028. Operational momentum is building: the company posted Q3 FY26 adjusted earnings per share of $0.72 versus consensus of $0.61—its third consecutive beat—and raised full-year fiscal 2026 net sales guidance to a range of $6.45–$6.55 billion. However, profitability remains compressed; GAAP net income fell 63% year-over-year due to restructuring charges and a raw potato inventory write-off.
CarMax represents an even more distressed opportunity, with shares down 56% over the past five years. The entry into both positions suggests Smith views these as turnaround candidates where activist engagement and operational discipline can unlock shareholder value in deeply out-of-favor corners of the consumer economy. This rotation underscores Starboard's flexibility in shifting from high-multiple software names toward lower-multiple, operationally challenged businesses where the fund's activism model historically has proven effective.
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