Bull Note Boosts Medtronic Stock to Seven-Month Highs

The medical device maker sports cheap options as well

Deputy Editor
Oct 8, 2020 at 10:41 AM
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The shares of Medtronic PLC (NYSE:MDT) are up 3.5% to trade at $109.43, after Stifel upgraded the medical device manufacturer to "buy" from "hold." The firm also raised its price target to $125 from $110, and expects to see positive change with the addition of Medtronic's new CEO Geoff Martha.

The equity just hit a seven-month high in response, handily clearing recent pressure at the 30-day moving average. It looks like the $110 level is still acting as a ceiling for MDT, rejecting the stock earlier in the session, and keeping it at a 3.7% deficit for the year. In the past three months, however, the security has tacked on 21.2%.

Analysts were mostly optimistic towards the security coming into today, with 16 calling MDT a "buy" or better, compared to four "hold" ratings. Meanwhile, the 12-month consensus price target of $116.83 is an 8.1% premium to current levels.

Meanwhile, options players have been running toward puts lately. This is per MDT's 10-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) of 0.82, which sits in the 85th percentile of its annual range, suggesting a much healthier appetite for bearish bets of late.  

Those looking to bet on Medtronic stock's next move should consider options. The equity's Schaeffer's Volatility Index (SVI) of 27% stands higher than just 15% of all other readings from the past 12 months. This implies options traders have been pricing in relatively low volatility expectations at the moment. 

 

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