Salesforce Stock Rises to New High on Top Pick Designation

Call buying has remained popular on CRM

Jan 6, 2020 at 10:36 AM
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Salesforce.com, Inc. (NYSE:CRM) is spiking to new all-time highs today thanks to bullish analyst attention. RBC came in and raised its opinion to "top pick" from "outperform," while boosting its price target to $215 from $200. The brokerage firm wrote that there are a number of ways CRM shares could see "significant" upside in 2020.

The stock was last seen up 2.2% at $169.75, earlier tapping a record peak of $170.35. On a year-over-year basis, the shares have added 23%, and many options traders seem to be betting on more upside. For instance, the last 10 days at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) has seen almost twice as many long calls traded as long puts.

Peak open interest for Salesforce is at the January 2020 170-strike call, followed by the 175-strike call. Those who bought to open these contracts are hoping CRM rises further in the coming days. Those looking to buy short-term options should note that the equity's 30-day at-the-money implied volatility is 22.8% and ranks in the 11th annual percentile, suggesting volatility expectations remain relatively low. Already today, calls are crossing at twice the expected rate.

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