PayPal Plunges 18% After Stripe and Advent Withdraw Acquisition Offer
Article excerpt
Highlighted: the sentence this signal was extracted from
PayPal shares fell nearly 18% before the open after Stripe and Advent abandoned, according to reports cited by the financial press, a potential acquisition valued at over USD $50 billion. The withdrawal hits the main argument that had driven the company's quarterly rally. *** PayPal shares plummeted nearly 18% in pre-market trading after Stripe and Advent reportedly abandoned talks to acquire the company. The potential transaction, which had exceeded USD $50 billion, was among the largest attempted acquisitions recorded in the fintech industry and had fueled much of the recent enthusiasm around PYPL. The pre-open price stood at USD $50.61, approximately 18% below the high of USD $62.73 reached just days earlier. The reaction shows how much weight the expectation of an acquisition had on PayPal's valuation, especially after its shares rose more than 40% during the quarter and pushed its market capitalization to around USD $52.6 billion. PayPal's stock market recovery was supported by two main elements: second-quarter results that exceeded analyst estimates and persistent speculation about a possible takeover. When a stock incorporates the expectation of a sale into its price, investors tend to value not only the current business performance but also the possibility of receiving a premium for their shares. In this case, the expectation gained strength after Bloomberg reported...
Keep reading with a free account
The rest of this article, and every signal for Stripe, is in your free account.
