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Investing.com - Truist Securities downgraded Vimeo (NASDAQ:VMEO) from Buy to Hold and slightly lowered its price target to $7.85 from $8.00 following the company’s pending acquisition by private firm Bending Spoons. The stock has shown remarkable momentum, surging over 74% in the past week and currently trading at $7.72, near its 52-week high of $7.90.
The rating change reflects the absence of a "go shop" provision in the acquisition agreement, which would have allowed Vimeo to solicit alternative offers from other potential buyers.
Truist Securities noted that the proposed takeout valuation aligns with its assessment of Vimeo’s fair value, suggesting limited upside potential from the current share price.
The firm’s revised price target of $7.85 precisely matches the cash offering price proposed in the Bending Spoons acquisition deal.
Truist Securities believes there is a "very high likelihood" that the transaction will proceed as stipulated in the agreement.
In other recent news, Vimeo reported its second-quarter 2025 earnings, delivering an earnings per share (EPS) of $0.04, significantly surpassing the forecasted $0.01. This represents a 300% surprise in EPS, although the company’s revenue was slightly below expectations, coming in at $104.7 million compared to the anticipated $104.87 million. Additionally, Vimeo has agreed to be acquired by Bending Spoons in an all-cash transaction valued at $1.38 billion, or $7.85 per share. This acquisition deal, approved by Vimeo’s Board of Directors, is expected to close in the fourth quarter of 2025. In another development, Vimeo announced a reduction of its global full-time workforce by nearly 10% to enhance focus and efficiency, with completion expected by the end of the fourth quarter of 2025. Furthermore, Vimeo has extended the exit date of its Chief Financial Officer, Gillian Munson, to September 30, 2025, to aid in ongoing operations and the search for her successor. The amended agreement for Munson includes a base salary of $100,000 per month during this transition period.
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