GoDaddy Stock Gains After Starboard Pushes for Changes, Including Potential Sale

GoDaddy shares were rising 2.1%. This year, the stock has gained 0.6%.

Starboard holds about a 7.8% stake in GoDaddy (ticker: GDDY), making it the company’s third-largest shareholder, according to the letter. The investor said it sees opportunities for management to make strides in operating and financial performance—including margin expansion—with even just moderate revenue growth. It suggested further cost cutting, regardless of progress in revenue growth.

Starboard also suggested that if GoDaddy doesn’t meet its goals, the company should “remain open-minded about alternative value creation opportunities,” including a potential sale.

Lastly, the activist investor said the website continually has ejected its requests for a direct role on the board.

“We find this deeply concerning, particularly during a time when GoDaddy has repeatedly missed its commitments and generated poor shareholder returns,” Starboard wrote in the letter.

GoDaddy sent an emailed statement to Barron’s, saying that since late 2021 the “GoDaddy management team and several directors have engaged in regular and constructive discussions with Starboard Value LP. We value their perspective and look forward to continuing the dialogue.

“We remain committed to positioning GoDaddy for sustained growth and profitability through innovations that help microbusinesses grow online and in person, while taking a disciplined approach to controlling costs and driving long-term shareholder value,” continued the letter from a GoDaddy spokesperson.

Write to Emily Dattilo at [email protected]