Why Quest Software's Shares Popped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Quest Software (NAS: QSFT) are up 10% today after the company received multiple buyout proposals.

So what: The company said today that it has received multiple alternative proposals to a $2 billion offer from Insight Venture Partners. Exact details weren't released, but analysts are expecting offers of around $25 per share, about where shares are currently trading.

Now what: Without knowing exactly what the offers are, it's hard to determine where the stock goes from here, but it should be noted that the company's special committee that will evaluate offers is currently backing the Insight bid. Considering the fact the stock is above the current offer on the table, I would at least take some chips off the table, if not cash out altogether to avoid potential damage from a lawsuit from shareholders alleging that the company rushed to sell. It's better to be safe than sorry betting on deals like this.

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At the time thisarticle was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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