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HubSpot (HUBS) Shares Fall as Alphabet Drops Buyout Plans
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Shares of HubSpot Inc. (HUBS - Free Report) declined more than 12% yesterday as various media reports revealed that Alphabet Inc. (GOOGL - Free Report) has shelved plans to acquire this customer relationship management (“CRM”) firm. Although spokespersons of both companies have refused to comment on the market speculation, sources familiar with the proceedings have confirmed the same.
HubSpot, headquartered in Cambridge, MA, specializes in providing sales and marketing software to small and midsize businesses, leveraging digital channels such as blogs, search engines and social media. Its diversified offerings include CRM and payment services, making it an attractive asset for Alphabet. The potential deal, reported earlier in April, would have been GOOGL’s largest-ever acquisition, with HubSpot reportedly valuing about $35 billion at that time.
From Alphabet's perspective, acquiring HubSpot would not only have bolstered its presence in the burgeoning CRM software market but also provided a significant boost to its cloud computing business, intensifying competition with industry giants like Microsoft and Amazon. Additionally, the acquisition could have enhanced competition in the marketing and sales software sector, countering the dominance of players like Salesforce and Microsoft.
For HubSpot, an acquisition by Alphabet could have offered access to greater resources and technological capabilities, enabling it to further innovate and expand its market reach. However, with the news of the deal falling flat, HUBS’ shares have taken quite a beating. The stock has lost 8.8% over the past year against the industry’s growth of 29.6%.
Image Source: Zacks Investment Research
It remains to be seen how this Zacks Rank #3 (Hold) firm addresses this situation to regain its growth momentum.
Key Picks
Ooma, Inc. (OOMA - Free Report) offers cloud-based communications solutions, smart security and other connected services. Its smart software-as-a-service and unified-communications-as-a-service platforms serves as a hub for seamless communications and networking infrastructure applications. Currently, Ooma sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
It delivered a trailing four-quarter average earnings surprise of 8.90%. In the last reported quarter, Ooma delivered an earnings surprise of 27.27%.
Motorola Solutions, Inc. (MSI - Free Report) , carrying a Zacks Rank #2 (Buy) at present, delivered an earnings surprise of 7.5%, on average, in the trailing four quarters. It has a long-term earnings growth expectation of 9.5%.
Motorola provides services and solutions to government segments and public safety programs, along with large enterprises and wireless infrastructure service providers. It develops and services both analog and digital two-way radio, voice and data communications products, and systems for private networks, wireless broadband systems and end-to-end enterprise mobility solutions to a wide range of enterprise markets.
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HubSpot (HUBS) Shares Fall as Alphabet Drops Buyout Plans
Shares of HubSpot Inc. (HUBS - Free Report) declined more than 12% yesterday as various media reports revealed that Alphabet Inc. (GOOGL - Free Report) has shelved plans to acquire this customer relationship management (“CRM”) firm. Although spokespersons of both companies have refused to comment on the market speculation, sources familiar with the proceedings have confirmed the same.
HubSpot, headquartered in Cambridge, MA, specializes in providing sales and marketing software to small and midsize businesses, leveraging digital channels such as blogs, search engines and social media. Its diversified offerings include CRM and payment services, making it an attractive asset for Alphabet. The potential deal, reported earlier in April, would have been GOOGL’s largest-ever acquisition, with HubSpot reportedly valuing about $35 billion at that time.
From Alphabet's perspective, acquiring HubSpot would not only have bolstered its presence in the burgeoning CRM software market but also provided a significant boost to its cloud computing business, intensifying competition with industry giants like Microsoft and Amazon. Additionally, the acquisition could have enhanced competition in the marketing and sales software sector, countering the dominance of players like Salesforce and Microsoft.
For HubSpot, an acquisition by Alphabet could have offered access to greater resources and technological capabilities, enabling it to further innovate and expand its market reach. However, with the news of the deal falling flat, HUBS’ shares have taken quite a beating. The stock has lost 8.8% over the past year against the industry’s growth of 29.6%.
Image Source: Zacks Investment Research
It remains to be seen how this Zacks Rank #3 (Hold) firm addresses this situation to regain its growth momentum.
Key Picks
Ooma, Inc. (OOMA - Free Report) offers cloud-based communications solutions, smart security and other connected services. Its smart software-as-a-service and unified-communications-as-a-service platforms serves as a hub for seamless communications and networking infrastructure applications. Currently, Ooma sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
It delivered a trailing four-quarter average earnings surprise of 8.90%. In the last reported quarter, Ooma delivered an earnings surprise of 27.27%.
Motorola Solutions, Inc. (MSI - Free Report) , carrying a Zacks Rank #2 (Buy) at present, delivered an earnings surprise of 7.5%, on average, in the trailing four quarters. It has a long-term earnings growth expectation of 9.5%.
Motorola provides services and solutions to government segments and public safety programs, along with large enterprises and wireless infrastructure service providers. It develops and services both analog and digital two-way radio, voice and data communications products, and systems for private networks, wireless broadband systems and end-to-end enterprise mobility solutions to a wide range of enterprise markets.