Domo Target of Unusually Large Options Trading (NASDAQ:DOMO)

Key Points

• Domo saw unusually heavy call option activity, with 7,658 calls traded on Thursday versus a typical daily volume of 3,866, signaling heightened speculative interest in the stock.
• The stock surged 28.8% to $4.06 on very heavy volume after Domo announced it would sell substantially all of its assets and certain liabilities to Progress Software for $400 million.
• Analyst views remain mixed: UBS upgraded Domo to buy with a $5 target, while Stephens downgraded it to equal weight despite lifting its price target to $4.00; the consensus rating is still Hold.

Domo, Inc. (NASDAQ:DOMO - Get Free Report) saw unusually large options trading on Thursday. Stock investors acquired 7,658 call options on the company. This is an increase of approximately 98% compared to the typical daily volume of 3,866 call options.

Domo Trading Up 28.8%

NASDAQ DOMO traded up $0.91 during trading hours on Thursday, reaching $4.06. 18,681,646 shares of the company traded hands, compared to its average volume of 1,825,323. The stock has a market capitalization of $183.13 million, a PE ratio of -3.06 and a beta of 1.79. Domo has a 12 month low of $1.84 and a 12 month high of $18.49. The company has a 50 day moving average of $3.31 and a two-hundred day moving average of $4.11.

Domo News Roundup

Here are the key news stories impacting Domo this week:

• Positive Sentiment: Domo agreed to sell substantially all of its assets and certain liabilities to Progress Software for $400 million, a deal that is driving investor optimism around a potential monetization of the business. Domo Announces Agreement to Sell Substantially All Assets and Certain Liabilities to Progress Software for $400 Million
• Positive Sentiment: Market coverage highlighted Domo’s after-hours surge following the acquisition announcement, reflecting enthusiasm that the transaction could provide a floor for valuation. Why Is Domo (DOMO) Stock Rallying Over 23% After Hours Today?
• Neutral Sentiment: Domo’s board also adopted a tax benefits preservation rights plan, which appears aimed at protecting tax assets during the transition and may help preserve deal value. Domo Adopts Tax Benefits Preservation Rights Plan
• Negative Sentiment: Stephens downgraded Domo from overweight to equal weight, which could temper some of the takeover-driven enthusiasm even as it raised its price target to $4.00. Stephens Downgrades Domo to Equal Weight

Insiders Place Their Bets

In other Domo news, insider Rpd Fund Management Llc sold 39,034 shares of Domo stock in a transaction dated Monday, June 1st. The stock was sold at an average price of $4.46, for a total value of $174,091.64. Following the completion of the sale, the insider owned 4,187,809 shares in the company, valued at $18,677,628.14. The trade was a 0.92% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. Also, EVP Daren Thayne sold 52,365 shares of the stock in a transaction dated Wednesday, June 24th. The stock was sold at an average price of $2.38, for a total transaction of $124,628.70. Following the transaction, the executive vice president owned 498,051 shares in the company, valued at approximately $1,185,361.38. The trade was a 9.51% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold 466,662 shares of company stock worth $1,483,488 over the last ninety days. Company insiders own 13.25% of the company's stock.

Institutional Trading of Domo

Hedge funds and other institutional investors have recently bought and sold shares of the company. Brevan Howard Capital Management LP boosted its holdings in Domo by 3.9% in the third quarter. Brevan Howard Capital Management LP now owns 50,740 shares of the company's stock worth $804,000 after purchasing an additional 1,924 shares during the period. Verition Fund Management LLC grew its position in shares of Domo by 8.1% during the 4th quarter. Verition Fund Management LLC now owns 35,876 shares of the company's stock valued at $302,000 after buying an additional 2,679 shares during the last quarter. Creative Planning raised its stake in Domo by 23.2% during the second quarter. Creative Planning now owns 15,362 shares of the company's stock worth $215,000 after acquiring an additional 2,889 shares during the period. Headlands Technologies LLC acquired a new position in Domo in the second quarter valued at approximately $42,000. Finally, Rhumbline Advisers grew its holdings in shares of Domo by 9.6% during the second quarter. Rhumbline Advisers now owns 54,308 shares of the company's stock valued at $759,000 after purchasing an additional 4,751 shares during the last quarter. 76.64% of the stock is owned by institutional investors.

Wall Street Analyst Weigh In

DOMO has been the subject of several research reports. UBS Group raised shares of Domo from a "neutral" rating to a "buy" rating and set a $5.00 price objective for the company in a research note on Thursday. DA Davidson reiterated a "neutral" rating and set a $3.50 target price on shares of Domo in a report on Tuesday, June 16th. Lake Street Capital upgraded shares of Domo from a "hold" rating to a "buy" rating and cut their price target for the company from $7.00 to $5.00 in a report on Thursday. Wall Street Zen downgraded shares of Domo from a "buy" rating to a "hold" rating in a research note on Sunday, March 29th. Finally, Weiss Ratings upgraded Domo from a "sell (e+)" rating to a "sell (d-)" rating in a report on Wednesday, July 1st. Three equities research analysts have rated the stock with a Buy rating, three have issued a Hold rating and three have issued a Sell rating to the company. According to MarketBeat.com, the stock has an average rating of "Hold" and an average target price of $4.00.

About Domo

Domo, Inc NASDAQ: DOMO is a cloud-based software company that specializes in business intelligence and data analytics. The company's flagship product, the Domo Business Cloud, provides organizations with an end-to-end platform to integrate, visualize and analyze data from a wide array of sources. By unifying disparate data feeds into interactive dashboards and custom applications, Domo enables real-time insights that inform decision-making across all levels of an enterprise.

Founded in 2010 by Josh James, Domo is headquartered in American Fork, Utah, and operates offices across North America, Europe and Asia Pacific.

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