Mastercard Stock Extends Gains on Bull Note

Options look attractive right now, too

by Emma Duncan

Published on Dec 11, 2019 at 9:38 AM

Credit and debit card name Mastercard Inc (NYSE:MA) is buzzing this morning, fresh off a bull note from SunTrust Robinson, and news it has begun testing its new digital service that can immediately and securely mark a person's identity in the physical or virtual realm. SunTrust hiked its price target to $340 from $325, marking a 17.8% upside to last night's close. This morning, the stock is trading up 0.3% at $289.50 in response.

Mastercard stock has been surrounded in bull notes this year, sporting 21 "buy" or better ratings coming into today, with zero "sell" ratings on the books. Plus, the stock's average consensus 12-month price target of $313.89 stands roughly 8% above current trading levels.

Now looks to be an affordable time to speculate on Mastercard stock with options. This is per the equity's Schaeffer's Volatility Index (SVI) of 19%, which ranks in the 15th percentile of its annual range. This indicates that short-term options have priced in lower volatility expectations just 15% of the time in the last year.

MA has been on a consistent -- and impressive -- climb higher since its public trading debut back in 2006. MA's most recent pullback was caught by its 160-day moving average, guiding the equity to its now 52% year-to-date gain.


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