3 Stocks Moving on M&A Buzz

Activist investors have taken aim at MITK and YELP

Dec 10, 2018 at 10:21 AM
facebook twitter linkedin


NutriSystem Inc. (NASDAQ:NTRI) stock is trading up 31.3% today at $44.90, following news the dieting expert is being bought by Tivity Health Inc (NASDAQ:TVTY) for $1.4 billion, or $47 per share. The shares had been trading around their downtrending 200-day moving average since early November, moving further away from their 52-week peak of $55.10 from last December.

This rally from NTRI stock may be a shock for all those shorting the name. Specifically, more than one-fifth of the float is held by short sellers, or more than nine times the average trading pace. Recent options traders had been bearish, too, with put buying more than tripling call buying during the past 10 days at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX).

Mitek Systems, Inc. (NASDAQ:MITK) is also gaining today, trading up 12% at $10.05, after ASG Technologies Group raised its buyout offer for the financial technology firm to $11.50 per share from $10. Elliott Management-backed ASG said it made the offer public because Mitek has refused to engage in reasonable discussions about a takeover deal.

MITK stock is now trading in double-digit territory for the first time since January, with the $10 mark acting as a ceiling in recent months. Earlier, in fact, the equity touched an annual high of $10.16. Still, the shares have enjoyed tremendous upside since bottoming at $6.32 in early October. All four brokerage firms covering Mitek Systems have "strong buy" recommendations.

Meanwhile, Yelp Inc (NYSE:YELP) stock is trading 2.1% higher at $35.33, after major shareholder and hedge fund SQN Investors LP called for an overhaul of the company's board, and said it wants the review site to consider all options, including a sale (subscription required). The stock has underperformed this year, down roughly 16% in 2018 and touching a 52-week low of $29.35 a month ago.

Most analysts have already taken a skeptical view of YELP shares, with 16 of the 21 in coverage handing out "hold" or "strong sell" recommendations. In a similar vein, options traders have pushed the 10-day put/call volume ratio at the ISE, CBOE, and PHLX to 2.29 -- ranking in the bearish 94th annual percentile.

 

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 

 


 


 
Special Offers from Schaeffer's Trading Partners