Splunk (NASDAQ:SPLK) stock is soaring higher on Thursday following news of an acquisition deal with Cisco (NASDAQ:CSCO).
This is massive news for holders of SPLK stock, as Cisco intends to pay $28 billion in cash for the company. That has it valuing shares of SPLK at $157 each, which represents a roughly 31.3% premium over its prior closing price.
Cisco notes that its acquisition of Splunk will be cash flow positive and gross margin accretive in the fiscal first year following the closure of the deal. The company also expects it to be accretive to adjusted EPS in the second year after it is completed.
Gary Steele, president and CEO of Splunk, said the following about the deal with Cisco:
“Uniting with Cisco represents the next phase of Splunk’s growth journey, accelerating our mission to help organizations worldwide become more resilient, while delivering immediate and compelling value to our shareholders.”
Following the acquisition deal, Steele will join the executive leadership team at Cisco. This will see him report directly to Cisco chairman and CEO Chuck Robbins.
SPLK Stock Reactions
With today’s announcement, shares of SPLK stock are seeing heavy trading volume. As of this writing, more than 9 million shares of the company’s stock have changed hands. For comparison, its daily average trading volume is closer to 1.6 million shares.
SPLK stock is up 20.9% as of Thursday morning.
Investors seeking out even more of the most recent stock market stories for today will want to stick around!
We’ve got all of the latest stock market news that traders need to know about on Thursday! Among that is why stocks are down today, as well as what’s moving shares of Seelos Therapeutics (NASDAQ:SEEL) and Heart Test Laboratories (NASDAQ:HSCS) stock today. All of that news is ready to go at the links below!
More Stock Market News for Thursday
- Why Are Stocks Down Today?
- Why Is Seelos Therapeutics (SEEL) Stock Down 25% Today?
- Why Is Heart Test Laboratories (HSCS) Stock Moving Today?
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
