Investors took notice as rumors swirled about an entertainment sector giant potentially acquiring a peer, causing Lionsgate Studios stock to surge 16% compared to S&P 500’s 0.9% increase. Paramount Skydance is reportedly crafting a bid to acquire Warner Bros Discovery, leading Warner’s stock to soar 29%. Lionsgate, with a market cap of $2.2 billion, could be a cheaper acquisition target.

The entertainment world was abuzz with news of a potential major acquisition, as Paramount Skydance is reportedly preparing an offer to purchase Warner Bros Discovery in a mostly cash deal. Warner Bros Discovery, with a market cap just over $40 billion, holds a variety of media assets in film, TV, and streaming video. Warner’s stock shot up nearly 29% on the acquisition news.

Speculation swirled as to why Lionsgate Studios didn’t attract similar acquisition attention, with its smaller size and market cap of $2.2 billion making it a potentially cheaper target. The possibility of big-ticket acquisitions inspiring further deals lingered, prompting investors to consider Lionsgate’s potential in the industry.

While Lionsgate Studios saw a surge in stock price amid acquisition rumors, investors should note that the company wasn’t among the 10 best stocks identified by The Motley Fool Stock Advisor team. The team’s top stock picks have historically produced significant returns, outperforming the S&P 500 by a significant margin. Joining Stock Advisor provides access to these top stock picks for potential market-crushing returns.

Read more at Yahoo Finance: Why Lionsgate Stock Crushed it on Thursday