Renewable Energy Stock Soars After Chevron Buyout

Options traders are targeting REGI after the buyout news

Deputy Editor
Feb 28, 2022 at 11:12 AM
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Renewable Energy Group Inc (NASDAQ:REGI) is up 38.8% at $60.80 this morning, after news that Chevron (CVX) will acquire the biofuel name for $61.50 per share in an all-cash deal worth over $3 billion. The deal is expected to close during the second half of the year, and is Chevron's largest alternative fuel bet so far. 

Plus, Renewable Energy Group is gearing up for its fourth-quarter earnings report, due out before the open tomorrow, March 1. Of its last eight reports, REGI finished higher after only three of its next-day sessions, averaging a swing of 7.7% in either direction. 

REGI is today pacing for its fourth-straight daily win, after bouncing off its Feb. 22, 18-month low of $32.54. Now trading at its highest level since early November, the equity is looking to break above the 320-day moving average. Over the past three months, REGI has added 25%.

The security's typically quiet options pits are buzzing after the acquisition news, with options volume running at 43 times the intraday average. The March 60 put is the most popular, followed by the April 65 call, with new positions being bought to open at both. 

It's also worth noting that short interest makes up 7.7% of the stock's available float. At REGI's average pace of trading, it would take over one week to buy back these bearish bets. 

 

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