It looks like Macy’s is the next target of activist hedge fund Starboard Value and its chief Jeff Smith. Shares in the largest department store in the U.S. could be worth $125 each, he claimed on Wednesday, July 15th at the CNBC Institutional Investor Delivering Alpha Conference in the Big Apple.

After the news hit the wires, Macy’s shares popped 5% to $70.09 as of 12:15 a.m. ET.

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Details on Starboard’s new stake in Macy’s

Speaking on a panel at the CNBC conference, Smith argued that Macy’s could easily separate its real estate from its retail business to unlock significant shareholder value. The historic retailer’s properties actually represent close to $21 billion of the firm’s $29 billion total enterprise value, according to Starboard’s analysis, Smith noted.

Smith pointed to Macy’s ultra-prime real-estate properties across the country, including its flagship stores in New York, Chicago and San Francisco. If you add up the iconic retailer’s credit card portfolio and real estate value, investors are actually getting “core operating profit for free,” Smith argued.

More on Starboard Value

Starboard typically targets mid-cap public firms where it sees hidden value, then encourages company execs and directors to make positive changes including spinoffs or sales of assets. The activist hedge fund recently undertook a campaign at Yahoo!, arguing the tech firm should spin off its $40 billion stake in Alibaba Group Holding to shareholders in the most tax-efficient manner. It was another win for Smith, as Yahoo announced plans to spin off its Alibaba stake early this year.

The activist hedge fund has been on a bit of a roll the last year or so. It was part of a campaign to get LSB Industries Inc. to separate its chemicals and climate-control businesses and elect a new board, it essentially forced office-supply companies Staples and Office Depot to merge, and in a big win, managed to convince shareholders to replace the whole BoD at Darden Restaurants after the firm’s sale of its Red Lobster chain.