Dynatrace (NYSE:DT) shares rose more than 8% in premarket trading on Tuesday following a report by The Wall Street Journal that activist investor Starboard Value has acquired a significant position in the AI software company and is advocating for strategic changes to lift its valuation.
According to the report, which cited a draft letter from a senior executive, Starboard Value views Dynatrace as undervalued relative to comparable companies.
The investor has reportedly been in private discussions with the company’s management over recent months.
Starboard is said to be urging the company to speed up its share repurchase efforts and believes Dynatrace has the capacity to return more than $2.5 billion to shareholders over the next three years, the report added.