Starbucks' China branch could be seeing new ownership
Beverage chain Starbucks Corp (NASDAQ:SBUX) is up 1.6% to trade at $126.15, after CNBC reported the company's China leg is attracting bids of up to $10 billion. The equity would retain a 30% stake, with offers coming in from big names such as Centurium Capital, Hillhouse Capital, and Carlyle Group.
Starbucks stock has been choppy on the charts this summer, with recent support stemming from its ascending 20-day moving average. Today's pop has SBUX trading at its highest level since April 2 and creating some separation from its year-to-date breakeven level. Over the past 12 months, the shares have climbed 30.5%.
Options traders have been bullish on the security. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OM X PHLX (PHLX), SBUX's 50-day call/put volume ratio of 2.11 ranks in the 98th percentile of annual readings. Echoing this, the security's Schaeffer's put/call open interest ratio (SOIR) of 0.88 stands in the 12th percentile of readings from the past 12 months.
Options are looking affordable as well. This is per SBUX's Schaeffer's Volatility Index (SVI) of 29%, which sits in the 16th percentile of its annual range. This indicates options traders are pricing in low volatility expectations. It's also worth noting that the equity has tended to outperform these expectations during the past year, per its Schaeffer's Volatility Scorecard (SVS) of 98 out of 100.