ASML Holding NV (ADR) (ASML) calls are active on news of a $1 billion deal
Netherlands-based chipmaker ASML Holding NV (ADR) (NASDAQ:ASML) is one of the top performers on the Nasdaq today, with the shares last seen 10% higher at $107.63 -- and just off an intraday peak of $111.20, within striking distance of their all-time high of $111.40, tagged in late March. Traders are applauding news that the company will sell 15 machines to a U.S. customer -- likely Intel Corporation (NASDAQ:INTC), analysts say -- in a deal worth more than $1 billion. As such, option bulls and analysts are waxing optimistic on ASML today.
In light of the equity's surge, its 30-day at-the-money implied volatility has popped 10.2% to 28.9% -- in the 76th percentile of its annual range. Digging deeper, call volume is running at four times the average afternoon pace, with buy-to-open action detected at the May 115 call. By purchasing the calls at a volume-weighted average price (VWAP) of $0.93, the buyers will profit if ASML topples $115.93 -- in uncharted territory -- by the close on Friday, May 15, when front-month options expire.
As alluded to earlier, the brokerage bunch is also weighing in on ASML Holding NV (NASDAQ:ASML). Rabobank upgraded the shares to "buy" from "hold," and lifted its price target to 110 euros from 85 euros. S&P Capital IQ also upped its opinion to "buy" from "hold" while lifting its target to 114 euros, while UBS hiked its target to 105 euros from 92 euros. Additional upward adjustments could be on the horizon, too, as the consensus 12-month price target of $96.73 stands at a notable discount to ASML's current perch.