Call Buyers Stay Behind Huntsman

Goldman Sachs added Huntsman to its conviction list

by Josh Selway

Published on Nov 18, 2019 at 10:19 AM
Updated on Jun 24, 2020 at 10:16 AM

Chemical stock Huntsman Corporation (NYSE:HUN) has been consolidating on the charts since early September, recently finding nice support from the 200-day moving average. While the $24-$25 range -- site of the shares' early 2019 highs -- is certainly on the radar as potential resistance, HUN just snagged a bullish analyst note, and options traders have been picking up calls at a rapid pace. 

Goldman Sachs this morning added the security to its conviction list, and the bullish sentiment matches that of the Street. By the numbers, 60% of covering firms have "strong buy" ratings on HUN, and the average 12-month price target for all those in coverage is $26.38 -- roughly 14% above current levels.

At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the 10-day call/put volume ratio for Huntsman is 12.18, a number that ranks in the 79th annual percentile. Said another way, there's been a notable bullish bias among options traders in recent weeks. That said, the Schaeffer's Volatility Index (SVI) for HUN is 32%, and ranks in the 11th annual percentile, so near-term options premiums still appear muted.

HUN traders have built up large positions at the January 2020 23- and 25-strike calls, home to the top two open position levels. In the front-month December series, peak open interest is actually on the put side at the 23 strike. Huntsman shares were last seen up 0.6% at $23.38.


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