Why Ancestry.com's Shares Soared


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 family-tree tracker Ancestry.com (NAS: ACOM) were getting a boost today from rumors that it may be about to get new parents. Shares rose as much as 18% on the reports.

So what: The fact that a sale may be in the offing isn't breaking news -- news outlets had previously reported that the website was talking to potential buyers. What today's note from The New York Times' DealBook brings to the table is that a deal with a private-equity company may be close and that the deal could be done between $35 and $39 per share.

Now what: While the news comes based on "people with knowledge of the matter," none of this means that a deal is definite, or that the suggested buyout price is on target. Placing bets in a buyout guessing game here might seem like easy money, but as a long-term strategy, money moves like that are more likely to lead to heartbreak than vast riches. If you think today's price is a fair one to own Ancestry.com for the long term, feel free to jump into the fray. But I'd be hard-pressed to say that chasing the potential buyout pop is a Foolish move.

Want to keep up to date on Ancestry.com?Add it to your Watchlist.

The article Why Ancestry.com's Shares Soared originally appeared on Fool.com.

The Motley Fool owns shares of Ancestry.com. Motley Fool newsletter serviceshave recommended buying shares of Ancestry.com. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.Fool contributorMatt Koppenhefferhas no financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting hisCAPS portfolio, or you can follow Matt on Twitter,@KoppTheFool, or onFacebook. The Fool'sdisclosure policyprefers dividends over a sharp stick in the eye.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Originally published