Google-parent Alphabet is mulling an offer for digital marketing specialist HubSpot, according to a report on Thursday. HubSpot stock popped on the news while Google stock fell as analysts raised questions over regulatory approval and the size of the deal.
Google is in talks with advisors about a potential bid for HubSpot, said a Reuters report.
Cambridge, Mass.-based HubSpot sells sales and marketing software to small and midsize businesses. It focuses on digital channels such as blogs, internet search engines and social media.
With roots in marketing software, it has expanded into customer relationship management as well as payment services.
HubSpot holds a market valuation of nearly $32 billion.
Regulatory Review Could Be Hurdle
"We are not sure anything is imminent related to this press report," said Truist Securities analyst Terry Tillman in a report. "The deal size would certainly be one of the biggest we have ever seen in application software and would likely entail meaningful regulatory review. It doesn't mean something may not play out."
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On the stock market today, HubSpot stock climbed nearly 5% to close at 657.85. Google stock fell 2.8% to 150.53 as the Nasdaq composite retreated again.
Shares in Salesforce fell 3.5% to 294.14. In the enterprise market, HubSpot competes against Salesforce and Adobe Systems.
Alphabet acquired cybersecurity firm Mandiant for $5.4 billion in 2022. It bought Fitbit for $2.1 billion in 2021. Google's most notable deals were YouTube, acquired for $1.65 billion in 2006, and digital ad firm DoubleClick, acquired for $3.1 billion in 2007.
HubSpot Stock Technical Rating
HubSpot aims to attract people to customer websites and optimize content so that visitors are converted into paying customers.
Some analysts view the software company as an AI stock to watch. HubSpot could get a boost from "generative AI" technologies such as ChatGPT.
Generative AI technology creates text, images, video and computer programming code. The new form of AI technology already is finding applications in marketing, advertising, drug development, legal contracts, video gaming, customer support and digital art.
The Relative Strength Rating of HubSpot stock is 86 out of a best-possible 99, according to IBD Stock Checkup. The best stocks tend to have an RS Rating of 80 or better.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
