The shares of Broadcom Inc (NASDAQ:AVGO) are up 11.1% to trade at $340.21 at last glance, after the semiconductor giant announced a fiscal third-quarter top- and bottom-line win. The company also revealed a new, unnamed new client ordered $10 billion in custom chips, which analysts suspect is OpenAI.
Analysts doled out at least 19 price-target hikes in response, including one from Melius Research to $415 from $335. Brokerages already lean bullish on AVGO, with 34 of 37 in coverage sporting "buy" or better ratings.
The security earlier hit an all-time high of $356.34, breaking above a recent ceiling at the $325 level. AVGO has added 45.3% so far in 2024, with recent support at its 50-day moving average, and is now on track for its best single-day percentage gain since April 11.
At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity sports a 50-day put/call volume ratio that ranks in the 94th percentile of annual readings. This suggests options traders were much more bearish than usual leading up to today.
Drilling down to today's options activity, 404,000 calls and 250,000 puts have already crossed the tape, which is 10 times the volume typically seen at this point. The most popular contract is the weekly 9/5 350-strike call, where positions are being opened.
Options traders are pricing in relatively low volatility expectations, too. This is per the equity's Schaefer's Volatility Index (SVI) of 49%, which sits in the 9th percentile of readings from the past 12 months.
