Dayforce Shares Pop on Report of Talks With Private Equity Firm Thoma Bravo
Key Takeaways
- Dayforce is reportedly discussing a sale to private equity firm Thoma Bravo.
- Bloomberg said a deal could be announced within a few weeks.
- Shares of Dayforce took off on the news, but they remain lower year-to-date.
Dayforce (DAY) shares soared more than 20% on indications that private equity firm Thoma Bravo is in talks to purchase the human resources software provider.
Bloomberg reported that people familiar with the matter indicated that an agreement could be reached in as soon as a few weeks. They added that while the discussions are in the advanced stage, they could be delayed or stumble, and another suitor might emerge.
In a note to investors, analysts at Jefferies noted that considering Dayforce’s stock had lost 28% year-to-date as of Friday’s close and the depressed valuation, “we are not surprised by PE interest.”
The analysts added they also wouldn’t be surprised to see Dayforce trying to sell because of the weakness in the stock price. They explained that it has been “tough sledding” for the company since the shares’ post-COVID highs, and they have underperformed the entire HR software group since the firm’s April 2018 initial public offering.
Investopedia has reached out to Dayforce and Thoma Bravo for comment.
Even with today’s gains, shares of Dayforce remain down 9% this year.
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