Investors bullish on report HP will acquire McAfee
Keeping Cisco at bay
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Wall Street investors showed new optimism in the shares of anti-virus provider McAfee after financial analysts speculated it may be acquired by Hewlett-Packard.
On Monday, shares in McAfee rose $1.44 to $41.57, the biggest gain in two months following a report from Friedman Billings Ramsey & Co. that an acquisition of the security software company would help HP compete against Cisco Systems. Trading in options, which give an investor that right to buy shares at an agreed-upon price, reached its highest level in close to a decade, according to Bloomberg BusinessWeek.
More than 31,500 call options to buy McAfee stock changed hands during regular trading on Monday. That was 81 times the four-week average and 10 time the level for puts to sell, the publication said. The most active options were those to buy McAfee at $45 by June 18, followed by those to buy the shares at $45 by May 21. McAfee hasn't closed above that amount since October, according to Yahoo Finance.
"The addition of McAfee would significant strengthen the company's presence in security and develop a competitive edge" on Cisco, the Friedman Billings report stated. It went on to predict that mergers and acquisitions in the software industry would accelerate this year and next.
The spike in the number of options for May and June are signs that some investors agree. They stand to profit if McAfee shares rise above $45. ®
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COMMENTS
That is going to help HP's relationship with Symantec
who they rely on for all the Veritas tools
re: Big fat b0rging machine
EDS was acquired by the services unit in HP. Which is a 40-50 bill$ business and gobbled up a 10-15 bill$ business. Nobody in the PC unit of HP was probably even consulted for that move.
Now this is [if the news is true] going to be a purchase by HP's PC unit - which is again a 40-50 bill dollar business by itself. They have nothing to do with what's happening in the EDS world.
Big companies, like GE & HP, have several businesses managed by one corporate. This helps in cost cutting & branding and little else.
Paris, coz she's a little slim b0rging m/c.
It's acquisition time!
DeWalt like to be the main guy, the big "playah" at companies. Being owned by HP would probably not excite him unless a substantial number of options were to vest immediately. An earlier person is correct. Symantec would not be pleased. Perhaps "individuals" at McAfee have some options vesting in the near future and an acquisition rumor could help bump things up a bit.
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