Put Traders Circle Soaring Zendesk Stock After Buyout

Put volume is running at 13 times what's typically seen

Deputy Editor
Jun 24, 2022 at 10:34 AM
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Zendesk Inc (NYSE:ZEN) stock is soaring this morning, up 29.2% to trade at $74.88 at last glance, after news that a group of private equity firms including Permira and Hellman & Friedman, will acquire the company in a $10.2 billion deal that will take Zendesk private. ZEN shareholders will receive $77.50 per share -- a 33.7% premium to last night's close. The stock is also trending on Stocktwits, garnering plenty of interest from individual investors. 

Craig-Hallum isn't pleased about the deeply discounted deal, however, stating that "it's wholly disappointing," and "we've long felt this is a premium company, premium product, a lot of runway for long-term growth." Of the 10 analysts in coverage, seven carry a lukewarm "hold" rating, with three a "strong buy." 

On the charts, ZEN is fresh off a June 16 two-year low of $54.16, and today's positive price action only has the stock jumping back up to its early June levels. Year-to-date, the equity is still down 28.4%. 

Meanwhile, puts are taking off in the options pits, with 16,000 puts exchanged so far -- 13 times the intraday average -- compared to 5,431 calls. The weekly 7/1 85-strike put is the most popular, followed by the January 2023 70 put, with new positions being opened at the latter. 




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