Five9 (NASDAQ:FIVN) announced that it has decided not to pursue a sale of the company, despite having been approached with such an opportunity.
This decision comes after recent reports suggested that the call center software firm was considering a sale.
Shares fell 6.4% on Tuesday and are down a further 2.6% in pre-market Wednesday.
The company had reportedly engaged in discussions with Zoom Video Communications (NASDAQ:ZM) about the possibility of resurrecting a deal, more than two years after a previous buyout attempt by the virtual meeting company had failed.
“We think the company was prudent in quickly dispelling the rumors, especially given that pending M&A rumors could potentially cause consternation among customers and prospects looking to close new deals with the company in the home stretch of the quarter,” analysts at Truist Securities said in a note.
“Rumors aside, we believe premium valuation and multiple expansion could be warranted owing to scarcity value in the enterprise segment of the contact center market that Five9 possesses and taking into account an expectation that sustained well above 20% plus growth on the enterprise side could be sustained over a multi-year basis.”