Confluent Inc (NASDAQ:CFLT) stock is surging today, up 11.2% at $23.05 at last glance, after a Reuters report stated that the software name is exploring a sale. According to the news, the company is working with bankers after attracting the attention of private equity and tech firms.
CFLT has rallied 46% off a late-July bear gap that culminated in a record low of $15.64. The shares traded as high as $24.07 out of the gate, but were turned away by their 320-day moving average. Since the start of the year, the equity is down 17.4%.
Short interest has been building, and now represents 7.9% of the stock's available float. It would take shorts nearly three days to cover, at CFLT's average pace of trading.
Options traders are chiming in on the takeover buzz, with 16,000 calls and 1,037 puts exchanged so far -- seven times the overall options volume typically seen at this point. The October 22 call is the most popular, followed by the 24-strike call in the same series.
The stock has rewarded option buyers over the past year, too. CFLT's Schaeffer's Volatility Scorecard (SVS) comes in at 85 out of a possible 100, meaning the stock has handily exceeded options traders' volatility expectations in the past 12 months.
