Software stock Dayforce Inc (NYSE:DAY) was last seen up 25.3% to trade at $66.24, after Bloomberg reported that private equity firm Thoma Bravo is in talks to buy the company, which is valued at $8.4 billion. Bloomberg also noted the potential for a bidding war, however, as well as other factors that could stall a deal.
Today's bull gap has DAY trading at its highest level since February, on track for its largest single-day percentage gain on record. Breaking above pressure at the $60 level for the first time since March, as well as resistance at the 320-day moving average, the shares are now in positive territory year-over-year.
A short squeeze could be exacerbating gains today. Short interest is up 24.2% in the last month, and now represents 4.8% of the stock's available float.
Furthermore, the equity was already overdue for a short-term bounce. Dayforce stock's 14-day relative strength index (RSI) of 28 sits in "oversold" territory.
DAY's typically quiet trading pit is bustling with activity today. So far, the stock has seen 2,032 calls and 1,772 puts exchanged, which is already 18 times its average daily options volume. The September 60 put is the most popular contract, with new positions being bought to open there.
