Harman International Industries Inc, Mentor Graphics Corp Muscle to Highs Amid M&A News

Harman International Industries Inc (NYSE:HAR) and Mentor Graphics Corp (NASDAQ:MENT) are trading at new highs following M&A deals

Nov 14, 2016 at 10:49 AM
facebook X logo linkedin


As the Dow chases a sixth straight day of gains -- not to mention fresh record highs -- a pair of major M&A deals are also grabbing headlines. Specifically, South Korea's Samsung Electronics has agreed to buy Connecticut-based automotive supplier Harman International Industries Inc (NYSE:HAR) for $8 billion, or $112 per share. Meanwhile, Germany's Siemens AG is buying Mentor Graphics Corp (NASDAQ:MENT) for $37.25 per share, valuing the all-cash deal at roughly $4.5 billion. Below, we'll take a look at sentiment data on HAR and MENT stock to see how the deals could be affecting traders across Wall Street. 

So far today, HAR has jumped 25.2% to $109.73, and earlier hit an annual high of $110.43. Looking back, this price level, not to mention Samsung's buyout offer, are still well below the stock's record high $149.12 from April 2015. Still, HAR stock had been showing some signs of life prior to today, up 10% in November as of Friday's close -- bolstered by a positive earnings reaction on Nov. 3. 

Many across Wall Street already had high hopes for HAR, too. The majority of covering brokerage firms have issued a "strong buy" recommendation, and options traders have been call-skewed in recent weeks -- albeit amid relatively low volumes. Looking at data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Harman International Industries Inc's 10-day call/put volume ratio comes in at 30.82, which is just 2 percentage points from a 12-month high. 

Turning to MENT, the shares earlier tagged an all-time best of $36.55, and were last seen 18.5% higher at $36.35. The stock had been performing well even before today, boasting a year-to-date lead of 66.6% as of Friday's close.

Like HAR, MENT's options pits have been almost entirely focused on call buying. During the past two weeks at the ISE, CBOE, and PHLX, the stock has accumulated a crazy call/put volume ratio of 65.83. Analysts have been more skeptical, though. Just one of five brokerage firms recommends buying Mentor Graphics Corp, and its average 12-month price target of $29.55 sits below the stock's pre-buyout closing price from Friday. 

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical levels, and top economic stories straight to your inbox.
 

Unlock Weekend Profits with Chris Prybal's Favorite Strategy Up +487.5% in 2024

With the markets going left, right, and sideways, you need to have a plan now more than ever. 

Expert Trader Chris Prybal is no stranger to volatility, and has mastered finding big stock rallies while other traders aren't looking over the weekend. Rallies that produced gains like +207% on RTX calls, +236% on MARA calls, and +238% on NET calls.

A few simple moves on Sunday at 7pm could be the “Secret Sauce” your portfolio needs to not just stay afloat, but make unprecedented gains in this turbulent market.


Don’t sit on the sidelines, beat the market with Chris Prybal's strategy. Join him now!

 

 
 
 


 
 

Rainmaker Ads CGI