Dell Stock Jumps on Upbeat First Quarter

No fewer than six analysts raised their price targets

by Laura McCandless

Published on May 29, 2020 at 10:53 AM
Updated on Jun 24, 2020 at 10:16 AM

The shares of Dell Technologies Inc (NYSE:DELL) are up 7.2% at $48.88, after the company shared an upbeat first-quarter report. The computer name reported higher-than-anticipated earnings per share as well as a revenue beat, with an increase in sales helping the company weather coronavirus headwinds. According to Jeff Clarke, vice chairman and chief operating officer, "customers need essential technology now more than ever to put business continuity, remote working and learning plans into practice." Following the report, no fewer than six analysts have raised their price targets, including Deutsche Bank and Instinet to $55. 

Today's pop has DELL toppling its 200-day moving average, a trendline that has served as pressure since June 2019, keeping a cap on growth long before the recent bear gap that coincided with the broader market. Over the past week, the equity has tacked on 13.5%. 

Many analysts were hesitant heading into today, with six in coverage sporting a "buy" or better, and the remaining five at a lukewarm "hold." Meanwhile, the 12-month consensus price target of $53.65 is a 7.5% premium to current levels. 

Though calls have outweighed puts in the options pits, puts look popular, per DELL's 50-day put/call volume ratio of 0.61 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio sits higher than 86% of readings from the past year, indicating puts have been purchased over calls at a faster-than-usual clip.

Now looks like a good time to weigh in on DELL options, as the stock's Schaeffer's Volatility Index (SVI) of 53% sits in the 25th percentile of its annual range. In other words, options players are pricing in relatively low volatility expectations at the moment, leaving traders with attractively priced premiums. 

 

 

 

 

 

 

 

 

 

 

 

 


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