Barracuda Networks Inc (CUDA) Looking to Potentially Sell Itself – Hires Morgan Stanley

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Shares of Barracuda Networks Inc (NYSE:CUDA) have suddenly spiked during afternoon trading today after reports from Bloomberg have indicated that the company may be exploring the possibility of selling itself. According to reports Barracuda Networks Inc (NYSE:CUDA) has hired Morgan Stanley to seek out potential buyers after the value of the company plunged over the last several weeks.

Shares of Barracuda Networks Inc (NYSE:CUDA) have dropped close to 40% since the start of 2016 after poor earnings caused quite a selloff over the last few weeks. At approximately 2:30 p.m. ET the stock began it’s climb on volume that’s well above average. It will be interesting to see if Morgan Stanley will be able to find a buyer, and at what price they will offer to take the company over at.

The stock is currently trading higher by 11.25% or $1.19 following the positive news, hitting $11.77 per share at the time of us publishing this article. About 1.39 million shares traded hands or up 42.33% from the average. CUDA has declined 74.11% since June 25, 2015 and is currently downtrending. It has underperformed the S&P500 by 65.24%.

From a total of 16 analysts covering Barracuda Networks (NYSE:CUDA) stock, 6 rate it a “Buy”, 0 a “Sell”, and 10 a “Hold”. This means that 38% of the ratings are positive. The highest target price is $42 while the lowest target price is $12. The mean of all analyst targets is $23.43 which is 99.07% above today’s ($11.77) stock price. Barracuda Networks was the topic of 25 analyst reports since August 18, 2015 according to the firm StockzIntelligence Inc. Imperial Capital downgraded shares on January 11 to a “In-Line” rating. Summit Research downgraded shares to a”Hold” rating and a $15 target share price in their report from a January 8. Morgan Stanley downgraded CUDA stock in a recent report from January 8 to a “Equal-Weight” rating. Piper Jaffray downgraded the rating on September 30. Piper Jaffray has a “Neutral” rating and a $20 price target on shares. Finally, JMP Securities downgraded the stock to a “Market Perform” rating in a report they issued on a January 8.

The institutional sentiment decreased to 0.92 in Q2 2015. It’s down 0.92, from 1.84 in 2015Q2. The ratio worsened, as 45 funds sold all their Barracuda Networks Inc shares they owned while 28 reduced their positions. 23 funds bought stakes while 44 increased their total positions. Institutions now own 36.70 million shares which is 24.64% more than the previous share count of 29.45 million in 2015Q2.

Francisco Partners Management Lp holds 53.76% of its total portfolio in Barracuda Networks Inc, equating to 6.15 million shares. Scgf Iii Management Llc owns 4.04 million shares representing 49.88% of their total US portfolio. Moreover, Scff Management Llc has 46.25% of their total portfolio invested in the company, equating to 938,591 shares. The Pennsylvania-based Hamilton Lane Advisors Llc has a total of 1.78% of their portfolio invested in the stock. Herald Investment Management Ltd, a United Kingdom-based fund reported 230,000 shares owned.

Since March 4, 2015, the stock had 0 insider purchases, and 9 selling transactions for a total of $1.11 million in net activity. Hughes Michael D sold 2,300 shares worth $41,400. Faugno David sold 19,800 shares worth $585,882. Driggs Dustin sold 2,083 shares worth $52,283. Jenkins William D Jr sold 7,500 shares worth $193,430. The insider Drako Dean M sold 50,059 shares worth $1.97M.

Barracuda Networks, Inc. creates and delivers security and storage solutions. The company has a market cap of $620.32 million. The Firm offers cloud-connected solutions for its clients to address security threats, improve network performance and protect and store their data. It currently has negative earnings. The Company’s security and storage solutions are connected to its cloud services, which enable continuous software updates, offsite redundancy and distributed capacity, and are offered on a subscription basis.

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