Cyberark Spikes 18% Following Merger Chatter; Oppenheimer Assigns 'Low Probability' On Transaction

Shares of Cyberark Software Ltd CYBR surged higher by nearly 20 percent early Wednesday morning following a report that the company is a potential acquisition target.

Haaretz, an Israeli-based publication, reported that Check Point Software Technologies Ltd. CHKP is in talks to acquire Cyberark.

Both Check Point Software and Cyberark are based in Israel.

Reuters noted that Check Point Software has been active on the M&A front and acquired two small Israeli start-ups in 2015: Hyperwise and Lacoon Mobile Security.

Oppenheimer: 'Low Probability' Based On Check Point's Historical M&A Strategy

Shaul Eyal of Oppenheimer briefly commented in a note that Check Point Software has historically pursued smaller-sized acquisitions. The analyst noted that both of the company's acquisitions in 2015 combined for a cost of less than $200 million.

Cyberark's market cap as of Tuesday's market close was $1.20 billion.

Eyal continued that while Check Point holds $3.6 billion of cash on its balance sheet, an acquisition of Cyberark "would certainly mark a deviation" from its strategy even though "financing such a hypothetical transaction is no hurdle."

"While we never say never, we currently assign such a transaction a low probability based mainly on Check Point Software historical M&A strategy," Eyal wrote before adding "history also has a tendency to rewrite itself."

Shares traded recently at $45.13, up 19.1 percent.