Apple Tailwinds Boost Broadcom Stock to Top of S&P

AVGO weekly calls are popular today

Nov 15, 2018 at 2:23 PM
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Broadcom Inc (NASDAQ:AVGO) is the top performing S&P 500 Index (SPX) stock today, last seen near session highs, up 5.4% at $238.33. The boost could be attributed to a positive analyst note on Apple (AAPL), with Morgan Stanley reiterating its bullish view on the Dow stock, helping allay recent fears of slowing iPhone sales that have weighed on not only AAPL shares, but the entire semiconductor sector, as well.

Today's move has AVGO stock back above its 200-day moving average, a trendline that's acted as a magnet since February. At the same time, the equity remains stuck in the series of lower lows that's contained it since late last year. Overall, Broadcom is down 7% in 2018.

avgo stock price

In the meantime, call options are popular, outpacing puts 7,100 to 4,200 today. Traders are opening new positions at the weekly 12/7 240-strike call, and if buy-to-open activity is taking place, it would show expectations of AVGO shares rising back above $240 in the coming weeks.

Coming into today, traders had actually been showing a stronger-than-usual interest in long puts. That is, the security's 10-day put/call volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) comes in at 0.94 and ranks in the 93rd annual percentile, showing this near-even split between call and put buying is quite rare.

Looking elsewhere, analysts have kept the faith in the chip giant. There are 26 brokerage firms tracking AVGO, and 21 of them have "strong buy" ratings. Moreover,the average 12-month price target stands up at $288.37, representing record-high territory.

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