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NYSE Euronext Shares Plunged: What You Need to Know

By Travis Hoium | More Articles
May 16, 2011 | Comments (2)

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of stock exchange company NYSE Euronext (NYSE: NYX  ) fell 11% today after the company lost two potential bidders for its shares.

So what: Nasdaq OMX (Nasdaq: NDAQ  ) and IntercontinentalExchange (NYSE: ICE  ) announced they were withdrawing a bid for the company after discussions with antitrust regulators. That leaves Deutsche Boerse as the company that will likely acquire NYSE Euronext after a long fight with other exchanges for the company.

Now what: Now the deal with Deutsche Boerse goes to a shareholder vote on July 7. Management preferred this deal all along, touting the growth opportunities for the German and U.S. exchanges. I don't see a reason to buy shares today given the loss of a higher bid, but this might be better for shareholders in the long run.

Interested in more info on NYSE Euronext? Add it to your watchlist.

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Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

Motley Fool newsletter services have recommended NYSE Euronext. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On May 16, 2011, at 9:05 PM, Zaneyjaney wrote:

    Travis, Thanks for the insights. An 11% drop like that is unnerving when one doesn't know what's going on. How do you think the Deutsche Boerse acquisition will be better for shareholders? I like the sound of it, just from what I know of German economic strength and mindset. (Alles Gute!)

  • Report this Comment On May 16, 2011, at 10:24 PM, TMFFlushDraw wrote:

    Consolidation in an industry like this is a good thing from a competitive standpoint. Exchanges rely on something called the Network Effect for a competitive advantage and this will only help NYSE while hurting Nasdaq. More shakeout is probably coming though.

    Foolishly,

    Travis Hoium

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Related Tickers

5/25/2012 4:02 PM
NYX $24.47 Down -0.03 -0.12%
NYSE Euronext CAPS Rating: *****
NDAQ $22.06 Up +0.26 +1.19%
Nasdaq Stock Marke… CAPS Rating: ****
ICE $125.49 Up +1.54 +1.24%
IntercontinentalEx… CAPS Rating: *****

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