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Citrix Systems Inc. shares rallied Tuesday for their best day in nearly two years following a report that two investment firms were considering a joint bid for the cloud-software company.
Citrix
CTXS,
shares had surged as much as 15.6% Tuesday, and were last up 12.2% at $93.88, putting them on track for their best one-day percentage gain since March 17, 2020, when shares finished up 15.1%. With Tuesday’s share move, Citrix has a market cap of $11.72 billion.
On Tuesday, Bloomberg News reported that Elliot Investment Management and Vista Equity Partners were considering making a joint bid for Citrix, citing unidentified sources close to the matter.
Back in September, Citrix had reportedly hired advisors to explore selling the company, while Elliot Investment took a 10% stake of the company.
Following Elliot’s stake, UBS analyst Karl Keirstead, who had raised his price target on the stock to $108 from $100 on Elliot’s move, said Citrix was “under-valued as investors over-index on metrics (revs growth, EBIT margins, cash flow) that are distorted by the term-to-subscription model transition and Citrix’s inability to correctly guide to the right mix.”
Citrix shares are up 35% over the past 12 months, compared with a 14% gain on the iShares Expanded Tech-Software Sector ETF
IGV,
a 25% rise in the S&P 500 index
SPX,
and a 19% gain on the tech-heavy Nasdaq Composite Index
COMP,
The news about Citrix follows that of another big software acquisition on Monday when Oracle Corp.
ORCL,
said it was planning to acquire Cerner Corp.
CERN,
for nearly $30 billion.
