In today’s market, Matterport (NASDAQ:MTTR) is one of the biggest movers investors are watching, with MTTR stock surging more than 200% at today’s highs. The stock has come off of its daily high as of early afternoon trading but continues to see an abnormal number of shares trade hands, with more than 55 million shares of MTTR stock traded as of 2 p.m. EST, compared to an average daily volume of around 2.6 million shares.

This move follows a big announcement for the immersive 3D digital twins company. CoStar Group (NASDAQ:CSGP) announced via a press release earlier today that it plans to acquire Matterport for $5.50 per share. Shares traded near the $5 level today before cooling off, but it’s clear many in the market expect this deal to take place at or around the target price.

Matterport shareholders will receive $2.75 in cash and the equivalent of $2.75 in shares of CoStar Group common stock when the deal is closed.

Let’s dive into what to make of this key announcement and whether Matterport is worth buying on this news.

MTTR Stock Surges on Acquisition Offer

Any time an acquisition like this is announced, the market is typically quick to re-price a given asset to its fair market value. CoStar Group believes Matterport shares are worth $5.50 per share, so that’s where the stock should trade.

Of course, with MTTR stock currently trading below that level, it’s clear the market isn’t 100% sold on the idea this deal will ultimately go through. I’ve long considered Matterport a value stock in the digital twins/immersive 3D technology space. And with so much room for growth, it appears this deal will certainly shed some light on CoStar Group moving forward as a way to play this sector.

Matterport’s business model appears to be one that competitors want to gain exposure to, and this stock currently looks undervalued based on its acquisition offer. There’s certainly some risk involved. But I wouldn’t be surprised to see arbitrageurs bid shares up toward their full value over the coming weeks.

For now, I think this is a stock investors will want to keep on their watch list.

On the date of publication, Chris MacDonald 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.