Shares of MTS Systems (MTSC) jumped a whopping 66% in December, according to data provided by S&P Global Market Intelligence, after the company agreed to an acquisition deal.
On Dec. 9, 2020, MTS Systems agreed to be acquired by Amphenol Corporation (APH 3.61%) for $1.7 billion, or $58.50 per share in cash. Amphenol expects the deal to be accretive to earnings, adding $0.16 per share in earnings the first year after closing, which is expected in mid-2021.
Interestingly, MTS Systems' shares are trading very close to the agreed sale price, and even above it at times, indicating that some investors are seeing the potential for a higher sale price.
The sale price is a significant increase from where shares were trading and consistent with where they had traded in the years prior to the market's crash in early 2020. And given the premium paid it doesn't seem likely that more bidders are on their way or that management has much leverage to get a higher price. Investors may want to simply take some, or all, of their gains off the table and move on to the next stock buying opportunity.