The two companies could form the third largest automaker in the world
Honda Motor Co Ltd (NYSE:HMC) stock is up 13.6% to trade at $27.13 at last glance, as merger talks with Nissan officially move forward, with plans to reach a conclusion in June 2025. The two companies could form the third largest automaker in the world, behind only Volkswagen and Toyota Motor (TM).
HMC is on track for its biggest single-day percentage gain since October 2008, and is now trading at its highest level since early November as it bounces off its Dec. 20, 52-week low of $23.43. Shares are also eyeing their first close above the 20-day moving average since October, but still sport a 12.6% year-to-date deficit.
Options volume is already running at nine times the intraday average amount, with 2.248 calls exchanged so far today, compared to just 312 puts. Most popular is the January 17, 2025 27.50-strike call.,
Short-term options traders have been bullish of late, per Honda Motor stock's Schaeffer's put/call open interest ratio (SOIR) that stands higher than just 21% of annual readings.
It's also worth noting that the stock has consistently outperformed volatility expectations in the last 12 months, as reflected in its Schaeffer’s Volatility Scorecard (SVS) score of 83 out of 100.