A Green Start to the Week 🍀

Sony, the company behind the world’s most popular gaming console, is buying an industry name synonymous with its closest rival. Sony is buying Bungie, a former Microsoft subsidiary, for $3.6 billion. 🔥 🔥

Bungie is the studio behind the world-famous Halo and Destiny franchises. The company developed Halo: Combat Evolved, Halo 2, Halo 3, and Halo: Reach before the studio went independent in 2007. The company then launched its own franchise, Destiny. Both Destiny and Destiny 2, the two installments of the franchise, were published in an arrangement with Activision Blizzard until Bungie ended its publishing partnership in 2019.

Sony will pick up one of the biggest modern gaming franchises at a tasty premium, but the question is… why? In many ways, this acquisition feels more like a spite-buy than a revenue builder. It’s almost as if Sony chose to buy a former Microsoft property as leverage. 🤔

Maybe Sony just wanted to flex that it can spend money, too. After all, Microsoft has expanded its own gaming ecosystem, giving rise to concerns that Microsoft could turn the games from its many studios into Xbox exclusives. 🎮

Either way, it doesn’t really matter — investors appeared to like the deal. Unlike Microsoft‘s controversial acquisition of Activision Blizzard (which has a few regulatory hoops to jump through), this deal is almost certainly a slam dunk. 🏀

$SONY surged 4.5% today.

Citrix Systems Inc. ($CTXS) is going private with Vista Equity Partners and Evergreen Coast Capital Corp. in a $16.5 billion all-cash deal. 💰 This deal is consistent with the last year’s uptick in buyout interest around software companies. 

2021 was a HUGE year for buyouts as $944.4 billion worth of private equity deals was recorded last year. Citrix’s latest deal with Vista Equity Partners — the PE branch of Elliott Management Corp. — will grant Citrix shareholders $104/share. The deal aims to unite Citrix with Tibco software, another one of Vista’s companies, to create a data-management software for businesses. 🤖

With Citrix’s current clientele, the Tibco-Citrix venture will have a joint customer base of 400,000 customers and 100 million users across the world, spanning 10 different countries. Armed with Citrix’s decent financial performance last year (+5.1% YoY revenue growth in Q4), this buyout in early 2022 is one of the largest LBOs so far this year. 💪

$CTXS fell 3.42% today on the news. 

As stocks drifted higher today, some names caught a rip on positive news (or momentum.) 💚 A few names were upgraded to “buy,” others reported earnings, and many more recovered ground from controversy. Let’s take a look:

NXP Semiconductor

The semiconductor company reported earnings today, beating analyst estimates. The company also authorized a $2 billion share repurchase program.

The good word send $NXP rising 8.4% today. It faltered slightly in afterhours trading.

Boeing

America’s leading aerospace company caught a huge updraft after minting a monster deal with Qatar Airways. A week ago, Airbus said it canceled Qatar Airways’ order for 50 A321 jets after months of turbulence. Boeing capitalized on the feud, swooping in to sell Qatar 25 737 Max 10 jets with options to acquire 25 more. The carrier also signed on the dotted line to become Boeing’s first customer for the freighter (cargo) version of the 777X. The company will acquire 34 777X jets, with options for 16 more. ✈️ ✈️

All in all, the sticker price is more than $34 billion. However, that’s before discounts or rebates from making such a beefy order. $BA added 5% today.

Spotify

Spotify recovered to the tune of double-digits after the company acknowledged the #SpotifyExodus, committing to add a content warning to podcasts and content relating to the COVID-19 pandemic. The company’s controversial flagship podcaster, Joe Rogan, also issued an apology to people who were offended by his comments. Spotify was upgraded by analysts (what a coincidence.) 😅

$SPOT rose 13.4%, clawing back its losses week-over-week, but it’s still down more than 19% on the month.

Honorable Mentions

We can’t help it — we love stocks that go up. Honorable mentions include Tesla (+10.6%), Netflix (+11%), and Beyond Meat (+15%). All three names were upgraded by analysts today.