Starboard's Activist Playbook: Why TripAdvisor's Hidden Value Will Ignite a Turnaround

TripAdvisor (TRIP), the travel giant grappling with declining core revenue and market skepticism, has become a prime battleground for activist investor Starboard Value. With a 9% stake valued at $160 million and a reputation for unlocking undervalued assets, Starboard's intervention presents a high-conviction Buy opportunity. This article analyzes how Starboard's track record of operational turnarounds, combined with TripAdvisor's underappreciated growth segments and governance reforms, could propel the stock toward its $34.48 valuation target—marking a potential 124% upside from current levels.

Starboard's Proven Playbook: A Catalyst for Turnaround

Starboard Value's 80% success rate across over 100 campaigns underscores its ability to restructure underperforming firms. Key wins include:
- Darden Restaurants (DRI): A 300% stock surge after board reshuffles and cost-cutting.
- eBay (EBAY): A 160% return post-non-core asset sales.
- Marvell Technology (MRVL): A 200% rally following strategic refocus and governance changes.

The firm's formula is consistent: asset monetization, operational discipline, and shareholder-friendly governance. For TripAdvisor, this playbook is tailor-made.

TripAdvisor's Undervalued Assets: Viator & TheFork as Growth Engines

While TripAdvisor's core brand revenue dropped 8% YoY in Q1 2025, two subsidiaries—Viator (experiences) and TheFork (dining reservations)—grew by 10% and 12%, respectively. These segments now represent 20% of total revenue, yet remain overshadowed by the struggling core TripAdvisor platform.

Starboard is likely to push for:
1. Strategic focus shift: Divesting non-core assets (e.g., underperforming regions) to channel resources toward high-growth Viator/TheFork.
2. Margin expansion: Reducing costs through automation and simplifying its complex global operations.
3. Capital returns: Share buybacks or dividends using proceeds from asset sales, directly addressing the stock's undervaluation.

Governance Simplification: A Foundation for Change

The 2024 merger with Liberty TripAdvisor Holdings eliminated dual-class shares, aligning with Starboard's preference for transparent governance. This simplification reduces management entrenchment, making it easier for Starboard to negotiate board seats or operational changes. A successful proxy battle, akin to its 48% success rate in 2024, could accelerate reforms.

Wall Street's Skepticism vs. Emerging Catalysts

Despite Starboard's bullish $34.48 valuation, TRIP trades at $15.35—a 55% discount. Skepticism stems from:
- Near-term challenges: A 15% decline in Experiences & Dining segment revenue due to self-service sales shifts.
- Macro risks: Travel demand volatility and competition from Google and Airbnb.

However, three catalysts could shift sentiment by year-end:
1. Q2 2025 Earnings: Strong performance in Viator/TheFork could signal operational momentum.
2. Starboard's Formal Demands: Expected by mid-2025, these may include cost-cutting targets or asset sales.
3. Gross Booking Value (GBV) Growth: A 10% YoY rise in Q1 hints at a rebound in travel demand.

Risk Factors and Mitigation

• Execution risks: Structural issues like declining Viator average booking values and supply chain fragility.
• Market skepticism: Investors may demand proof of execution before buying in.

Mitigation hinges on Starboard's ability to de-risk the portfolio:
- Divesting underperforming assets (e.g., TheFork's European operations) to focus on high-margin experiences.
- Leveraging its 74% success rate in midcap activism to pressure management into swift action.

Investment Thesis: Buy with Conviction

TripAdvisor's $19 billion equity undervaluation is a textbook opportunity for Starboard's playbook. With governance issues resolved and high-growth segments in place, the stock could reach $20+ by late 2025—a 30% upside—before approaching its $34.48 target.

Recommendation:
- Buy TRIP with a $20 price target (12-month view).
- Hold for 12–18 months to capture asset sales, margin improvements, and governance gains.
- Risks: Monitor Q2 results and Starboard's demands closely; avoid if macro travel demand weakens further.

Conclusion

Starboard Value's activism at TripAdvisor is a classic value-unlocking play. The firm's proven ability to restructure operations, simplify governance, and prioritize shareholder returns aligns perfectly with TRIP's undervalued assets and structural upside. While near-term skepticism persists, the combination of Viator/TheFork's growth, governance reforms, and Starboard's urgency makes this a compelling high-conviction Buy for investors willing to look past short-term noise.

Stay tuned for Q2 results and Starboard's formal demands—these will be critical catalysts in the coming months.