DSP Group, Inc. (DSPG): Starboard Keeps Cutting Activist Stake as Stock Continues to Gain Ground

Jeff Smith‘s Starboard Value has further reduced its position in DSP Group, Inc. (NASDAQ:DSPG), ass the appreciated in the last several months. In a new filing Starboard disclosed holding around 1.04 million shares of the company, versus 1.35 million shares reported in an earlier filing. Following the sale, Starboard’s activist stake amasses 4.8% of DSP Group’s common stock, down from 6.1% held previously.

Jeff Smith

Starboard has been a long-term shareholder of DSP Group, Inc. (NASDAQ:DSPG) and has held shares of the company since 2011, during which the stock appreciated by around 90%. However, over the last 2 years, the investor has been mostly cutting its position in the stock. Since it has held an activist stake, Starboard, over the last year, has discussed with the company’s management and board of directors regarding the company’s financial performance and nominated directors on the board. This is a common practice for Starboard, which is an activist fund focused on small-cap companies. A couple of days ago, Starboard reported a new position in Integrated Silicon Solution, Inc. (NASDAQ:ISSI), which contains 7.2% of the common stock and formed a stockholder group with another shareholder and expressed its plans to nominate a candidate to be elected to the company’s board of directors.

In DSP Group, Inc. (NASDAQ:DSPG), Starboard has been reducing its exposure as the company’s financial performance has been improving. The $237 million provider of wireless chipset solutions for converged communications has last reported revenues of $37 million for the third quarter, up from $35 million for the same period of last year, while its earnings went up to $0.03 per share, from $0.02 for the third quarter of 2013.

However, while Starboard has been reducing its position in DSP Group, Inc. (NASDAQ:DSPG), some other investors have been bullish on the stock. In this way, among the funds that we track at Insider Monkey, Richard Mashaal’s Rima Senvest Management is the largest shareholder and, after upping the stake by more than 40% during the third quarter, it owns 1.39 million shares of DSP Group, while Jim Roumell’s Roumell Asset Management inched up its position by 5% to 959,000 shares.

Analysts have had mixed sentiments regarding DSP Group, Inc. (NASDAQ:DSPG) of late. In November, Roth Capital initiated coverage on the stock and set a ‘Buy’ rating, but Zacks and TheStreet have downgraded the stock to ‘Neutral’ and ‘Hold’ respectively from ‘Buy’.

Disclosure: none