Auto stock General Motors Co (NYSE:GM) is on the rise today, up 2.3% at $59.96 at last glance, after an upgrade from UBS to "buy" from "neutral," with a lofty price-target hike to $81 from $56. The firm expects the company's profit margins to return to the 8-10% range due to a number of factors, including interest rate cuts, despite continued tariff concerns.
On the charts, recent pressure at the $60 level appears to be keeping a cap on today's gains. The stock has been chopping higher since bouncing off its April lows, which hovered around $41, and is up 12.5% since the start of the year.
Options bulls are betting on GM's bounce, with 20,000 calls exchanged so far today -- quadruple the intraday average -- in comparison to just 2,829 puts. The November 62.50 call is the most popular, with new positions being opened there.
This shows an optimistic shift amongst traders, as puts have been more popular than usual over the last two weeks. GM's 10-day put/call volume ratio of 1.23 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks higher than 81% of readings from the past year.
Options look like a good way to go when weighing in on GM's next move, per its Schaeffer's Volatility Index (SVI) of 29%, which sits in the low 7th percentile of its annual range. This means traders are pricing in low volatility expectations -- a boon for options buyers.
