Nutanix stock rallied 20% on reports of a potential sale to interested parties.
Investors cheered the news despite a lack of confirmation of the same.
However, Nutanix stock could fall if a sale does not materialise.
The Nutanix Inc (NASDAQ: NTNX) stock price rallied 20% after the Wall Street Journal reported that the company was exploring a potential sale after receiving buyout interest from interested firms. According to the WSJ report, people familiar with the matter noted that the could computing company was exploring a potential sale to private equity firms or industry players.
However, the company had not agreed to a sale yet. Analysts believe a sale is far from agreed upon, given that buyers would have to offer a significant premium to the cloud computing company’s current stock price since its shares are down 33.72% this year.
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Despite the overall decline since the year started, Nutanix shares had rallied 47% in the past three months, which means that potential buyers would have to pay much more than what they could have paid in June and July when the stock was trading sideways.
Given the premarket rally in Nutanix stock, it appears investors are keen on a potential sale of the company to other firms as opposed to it remaining a public company and being subjected to the constant changes in investor sentiment that drive the stock prices of most companies.
Investors who missed out on the recent 3-month rally in Nutanx shares and today’s significant rally may be best served to avoid the stock. The chances of Nutanix shares falling if a takeover is not confirmed are incredibly high. Therefore, investors who buy now are at significant risk of losing a chunk of their investment.
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*This is not investment advice.
Nutanix stock price.
Source: Tradingview
The Nutanix stock price rallied 20.2% to trade at $25.42, rising from Thursday’s closing price of $21.15.
Simon ist Autor und Analyst für den Bereich Finanzwesen und blickt auf über sechs Jahre professionelle Erfahrung als Trader zurück. Er absolvierte einen Bachelor in Mathematik und Informatik und hat eine Leidenschaft für die Finanzmärkte. Simon handelt FX, Rohstoffe und Aktien. Er konzentriert sich auf Price Action Trading.
