Looking at the earnings release, it's interesting that the non-GAAP result for 2021 is 87% of the 2020 numbers. The day the 2020 earnings was released, the stock was trading around $133. 87% of $133 is ~$116, not $104.
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Shareholders might not approve it.
While I agree that the price is low and that we are better off continuing to be a separate publicly traded company, the value that you should focus on is market cap and debt. We currently have about 125 million common stock shares outstanding. That amount x $104 equals $13 billion. Additionally you have to factor the debt that the buyer is assuming, which is $3.35 billion as someone has to pay for that debt (that is how the Wrike acquisition value was determined if you read our M&A footnote closely). As a result, the total value of this deal is really $16.35 billion. If like you say Wrike is worth $2 billion, that means that Citrix sans Wrike is worth $14.35 billion, which is 4.48x revenue. That is not a terrible multiple unfortunately. While I know that $104 is still low relative to the $140s per share the stock was trading at before 2021 happened, unfortunately our current situation is very dire. Our leadership got us into this situation and they are just looking to cash in their chips while they can. So $104 is the best they can do given the current ho-e we are in. Now let’s not forget that when Templeton was CEO, our shares were never above $100. As a result, the executives (especially those who were here during those times) are likely seeing this deal as a big win (for them).
Now, don’t get me wrong as I feel this deal is terrible to the employees but if you are a stockholder who is not an employee, you would likely think that getting 30% over the price before the deal was announced is not a bad deal. That 30% is also aligned with other control premia like another poster said and which I verified. As a result, not much you can do about it if the shareholders approve the deal. Now for those of you who have Citrix stock and are an employee, you have the right to voice your concerns when the proxy vote comes outs regarding whether we the shareholders approve the deal. Use that to your advantage to see if we can change the outcome of this deal. I doubt that as financial institutions own a lot of Citrix shares and will likely approve the deal, but who knows. We ought to try if we can. Good luck fellow Citrites.
Contact SEC. Some kind of collusion going on with $2.25B Wrike deal with Vista and now Vista/Elliott buying Citrix for $104/share. The buyout price is way too low for shareholders to accept.
Think about this…Citrix paid $2 billion to Vista for Wrike. So, if Vista pays the same thing to get Wrike back, Citrix was purchased for $8 billion, not $10 billion.
Unless Wrike wasn’t worth $2 billion…..
Doesn’t seem fair to shareholders but what do I know!
Stock price is derived considering future earnings potential and current micro and macroeconomic conditions. Related to FY 2020 earnings, those were released considering the favorable impact of the covid pandemic which saw significant growth and earnings potential relative to 2019. Accordingly, the earnings guidance provided was very favorable into 2021 and thereafter. Moreover, we were years removed from a significant restructuring program and our CEO (Henshall) hadn’t stepped down. As a result, the picture was very rosy coming into 2021. Now fast forward into the 2021 earnings release and our conditions are very different. Earnings guidance has been reduced, the overall sentiment is that we are in a transition period with the interim CEO and all the noise around the restructuring and talent leaving and naturally stock price takes a hit. Accordingly, your comparison should really take into account conditions existing as of a point in time. Regarding your comment on whether this is a bargain/steal for the buyer, the control premium paid (30%) is actually what the market dictates. If you Google average control premium in valuation you will see that it typically ranges between 20 and 40% and even aligns with past acquisitions that have hit the news.