Please ensure Javascript is enabled for purposes of website accessibility

Why Cloudera Stock Jumped Higher on Tuesday

By Daniel Sparks – Jun 9, 2020 at 5:18PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Investors are betting this tech stock is about to get bought out.

What happened

Shares of cloud-based data and analytics specialist Cloudera (CLDR) spiked on Tuesday, closing the trading day up nearly 19%.

The stock's gain follows a report that the company could get acquired. Investors seem to be bidding up shares in hopes that the stock gets bought out at a premium.

A chart showing a line moving higher

Image source: Getty Images.

So what

Citing "people familiar with the matter," Bloomberg reported on Tuesday that Cloudera was exploring a sale, following interest from a potential buyer.

In a follow-up note to investors, DA Davidson analyst Rishi Jaluria raised his price target for the stock from $13 to $15, noting that a sale of the company is "increasingly likely..." The stock closed June 8 at $10.11.

Now what

Investors shouldn't count on profiting from a potential sale of the company. Not only is the price that the company would sell for unclear, but Bloomberg's sources apparently said no deal is certain to come to fruition.

On the other hand, of course, investors also shouldn't rule out the possibility of a sale.

Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Cloudera Stock Quote
Cloudera
CLDR

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
332%
 
S&P 500 Returns
104%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/30/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.