CyberArk Stock Jumps on Report Palo Alto Is Nearing $20 Billion Takeover

CyberArk would likely be valued at more than $20 billion in any acquisition, according to The Wall Street Journal. (Dreamstime)

Shares of CyberArk Software spiked Tuesday after The Wall Street Journal reported that Palo Alto Networks was in discussions to acquire the Israeli cybersecurity company.

The two companies could reach an agreement as early as this week, the Journal said. With a market capitalization of $19.3 billion as of Monday’s close, CyberArk would likely be valued at more than $20 billion in any acquisition, the Journal added.

CyberArk stock was rising 12% in afternoon trading, having fallen earlier in the day.

Meanwhile, shares of Palo Alto , which also provides cybersecurity solutions, were slumping 4.6% to $195.19 after the report.

Both companies declined to comment to Barron’s.

Palo Alto has been on the hunt for acquisition candidates, and a deal for Cyber Ark would make sense, said Dan Ives of Wedbush Securities in a research note Tuesday.

“We would view this potential move as a strategic home run deal,” Ives wrote, adding that CyberArk has “some of the best technology in the cybersecurity landscape.”

Wedbush maintains an Outperform rating and $225 target price on Palo Alto shares. Wedbush Fund Advisers last month launched the Dan IVES Wedbush AI Revolution exchange-traded fund , which holds Palo Alto stock.

Write to Nate Wolf at nate.wolf@barrons.com