PepsiCo Stock Gains Ground on SodaStream Buyout News

PepsiCo put buyers are getting a good deal at the moment

Managing Editor
Aug 20, 2018 at 9:59 AM
facebook twitter linkedin


Shares of PepsiCo, Inc. (NASDAQ:PEP) are up 0.6% at $115.59 in early trading, after the beverage powerhouse announced its purchase of at-home carbonated drinkmaker SodaStream (SODA) for $3.2 billion in cash, or $144 per SODA share. SODA stock, meanwhile, has jumped 9.6% to trade at $142.34.

PEP has had a volatile year on the charts, bottoming out at a two-year low in early May, and surging to a six-month peak above $118 earlier this month. And despite its recent pullback, support was quickly found at the 320-day moving average, a level which previously acted as a floor for the stock in late 2017. In spite of this, the shares of Pepsi are just 3.8% lower year-to-date.

Digging into options, near-term traders have been more put-heavy than usual toward PepsiCo stock. This is per the equity's Schaeffer's put/call open interest ratio (SOIR) of 1.07, which ranks in the 81st percentile of its annual range.

Those currently purchasing premium on short-term puts are in luck. This is per the stock's Schaeffer's Volatility Index (SVI) of 14%, which ranks in the low 25th percentile of its annual range. This suggests that muted volatility expectations have been priced into short-term PEP options.

 

Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

 
Schaeffer's Daily Bulletin Offer
 


 


 
Special Offers from Schaeffer's Trading Partners