Multiple (GoDaddy, News Corp, Fortrea) GDDY, NWSA, FTRE
Starboard pitches three activist ideas at the 2023 13D Monitor Summit — GoDaddy margin expansion, News Corp digital-real-estate separation, and Fortrea CRO profitability fix — each with 50%+ upside.
Thesis
This 2023 Active-Passive Investor Summit deck presents three simultaneous Starboard ideas. First, GoDaddy (EV $14B, 11x P/FCF) should expand Adj. EBITDA margins from 28% to 33%+ exiting 2024 by cutting bloated Tech & Development spend (20.9% of revenue vs. flat revenue growth), reaching 40% growth-plus-profitability and $10+ FCF per share in FY25. Second, News Corp trades near $22 versus a ~$33 sum-of-parts: its 61% stake in REA Group alone is worth ~$8B, implying the rest of the portfolio (Dow Jones, HarperCollins, Foxtel, News Media, Move) trades at just 4x FY24 EBITDA — Starboard demands separation of the Digital Real Estate assets. Third, Fortrea, recently spun from LabCorp, runs 13% EBITDA margins versus 18% peer median; CEO Tom Pike (who drove 425bps at IQVIA/Quintiles) can close the gap for 60-144% share-price upside to $47-72.
SCQA
Starboard presents three undervalued public companies at the 2023 13D Monitor Active-Passive Investor Summit: GoDaddy (domains/hosting market leader), News Corp (diversified global media), and Fortrea (contract research organization recently spun-out from LabCorp).
All three underperform peers on margins or trade below intrinsic value: GoDaddy's growth-plus-profitability has declined 700bps since 2021, News Corp's REA Group stake masks a cheap $4B RemainCo at 4x EBITDA, and Fortrea's 13% EBITDA margin trails the 18% peer median.
Starboard demands GoDaddy expand EBITDA margins from 28% to 33%+ via Tech & Development cost cuts, News Corp separate its Digital Real Estate assets to force sum-of-parts recognition, and Fortrea close the margin gap under proven CRO operator Tom Pike.
Execution delivers $10+ FCF per share and a 7x multiple re-rating at GoDaddy, a ~$33 sum-of-parts value (~50% upside) at News Corp, and an implied $47-$72 share price at Fortrea (60%-144% upside from $29.46).
The three reasons
- 1
GoDaddy can expand Adj. EBITDA margins from 28% to 33%+ and reach $10+ FCF per share
- 2
News Corp's non-REA businesses trade at just 4x EBITDA; separating digital real estate unlocks ~50% upside to $33
- 3
Fortrea's 13% EBITDA margin trails the 18% peer median; Tom Pike (ex-IQVIA) can drive 60-144% upside to $47-72
Primary demands
- GoDaddy: expand Adj. EBITDA margins from 28% to 33%+ exiting 2024 via Tech & Development cost rationalization and G&A/marketing discipline
- GoDaddy: target 40% growth-plus-profitability by Q4'24, unlocking $10+ FCF per share in FY25
- News Corp: separate the Digital Real Estate assets (REA Group stake, Move/realtor.com) to unlock sum-of-parts value
- News Corp: re-rate the remaining businesses (Dow Jones, HarperCollins, News Media, Foxtel) trading today at only 4x FY24 EBITDA
- Fortrea: close the 500bps EBITDA margin gap vs. peer median (13% vs. 18%) under CEO Tom Pike
- Fortrea: execute on post-spin operational discipline to achieve FY22-style profitability by end of FY24
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Precedents cited
- Starboard's 2022 Summit picks: Splunk (+100%), Salesforce (+39%), Wix (+12%)
- Tom Pike transformation of IQVIA/Quintiles (425bps margin expansion, 48% outperformance 2013-2016)
- LabCorp / Covance (2015, 14x)
- PE Consortium / PPDI (2017, 13x)
- Pamplona Capital / PAREXEL (2017, 15x)
- INC Research / inVentiv (2017, 14x)
- LabCorp / Chiltern (2017, 13x)
- ICON / PRA Health (2021, 25x)
- EQT / Parexel (2021, 20x)
- Thermo Fisher / PPD (2021, 23x)
- Triton Advisers / Clinigen Group (2022, 15x)
- PE Consortium / Syneos Health (2023, 10x)
Notable slides (5)
Notes
Filename labels this a 'Fortrea' deck but it is actually Starboard's 2023 13D Monitor Active-Passive Investor Summit portfolio presentation covering three distinct ideas: GoDaddy (pp. 6-29), News Corp (pp. 31-51), and Fortrea (pp. 53-68). Opens with a rare mea-pre-culpa scorecard of prior year's picks (Splunk +100%, Salesforce +39%, Wix +12% vs. S&P +20%) on pp. 2-5. Classified as initial_thesis because all three are freshly-presented ideas at this annual summit, but note the format is a conference showcase rather than a single-target campaign deck. No stake disclosed in this document. Tone is collaborative/analytical throughout — Tom Pike is cited approvingly, not attacked. Tom Pike CEO quote on p.63 is supportive (track record) not contradictory. Cover cites 10XEBITDA.com watermark source.