Cowen Stock Hits 8-Month Highs on Buyout Buzz

The equity has staged an impressive recovery off its mid-June lows

Deputy Editor
Aug 2, 2022 at 9:19 AM
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Shares of Cowen Inc (NASDAQ:COWN) are 7.6% higher in premarket trading, last seen at $38.18 after Canada-based TD Bank (TD) said it will buy Cowen for $1.3 billion in cash, or $39 per share. The acquisition, which is expected to close in the first quarter of 2023, signals TD Bank's acceleration of its long-term growth strategy in the U.S.

On the charts, COWN continues to recover from its mid-June, annual low of $21.36. In fact, an early July bull gap helped propel the shares above the $28, while its 20-day moving average guided the equity even higher. Should Cowen stock's premarket gains hold, it will put the security at its highest level since November 2021, and back above its year-to-date breakeven mark.

There's call-bias amongst short-term options traders. This is per COWN's Schaeffer's put/call open interest ratio (SOIR) of 0.27, which stands higher than just 15% of readings from the past year. 

Meanwhile, a look at short interest shows a slight 4.4% drop in the last reporting period. Despite this, the 5.10 million shares sold short make up a solid 19.8% of the stock's available float, and would take over seven days to cover at Cowen stock's average daily pace of trading. 

 

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