Shares of work messaging company Slack (WORK) - Get Report spiked Monday on a report the company has struck a deal with International Business Machines (IBM) - Get Report to become the company’s official messaging service.
Business Insider reported that IBM would be deploying access to Slack to its more than 350,000 employees, making IBM the company’s single-largest customer.
IBM reportedly has been using Slack since 2014 and the company said that the transition was occurring partly because employees were already freely using the app before the company got involved.
Slack couldn't immediately be reached for comment.
Slack shares were up 14% to $26.20.
Last week, Slack leaped after RBC Capital Markets analysts started coverage of the stock with an outperform rating and a $25 price target.
The RBC analysts in a report lauded Slack for its “leading brand, differentiated technology, and strong tailwinds from a growing workplace-collaboration market.”
Some analysts and investors have shrugged off Slack as just another messaging service amid a sea of competitors. The RBC analysts don’t see it that way.
“While the simplistic take on Slack is that it is ‘just another workplace chat tool,’ ... the vision around becoming the primary system of engagement for all employees inside (and increasingly outside) an organization creates a positive data-feedback loop,” the analysts said.
The San Francisco company went public last June 20 in a direct listing, with a starting reference price of $26. In its first day of trading the stock moved as high as $42. It traded below $20 in November.