Two investment firms were considering a joint bid for Citrix Systems Inc., and the shares rallied Tuesday for their best day in nearly two years.
The shares of Citrix CTXS 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. In September, Citrix had hired advisors to look into selling the company, while Elliot Investment took a 10% stake in the company. After Elliot's stake in the stock, UBS analyst Karl Keirstead, who had raised his price target on the stock to $108 from $100 on Elliot's move, said that Citrix was undervalued as investors over-indexed on metrics like growth, EBIT margins and cash flow that are distorted by the term-to- subscription model transition and Citrix's inability to guide to the right mix. The news about Citrix shares has gone 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.