Option Bulls Cheer as Buyout Buzz Boosts Syngenta AG (SYT)

Syngenta AG (ADR) (NYSE:SYT) has taken flight amid more ChemChina buyout rumors

by Alex Eppstein

Published on Dec 9, 2015 at 3:11 PM
Updated on Jun 24, 2020 at 10:16 AM

Syngenta AG (ADR) (NYSE:SYT) is blowing up on reports that it could be acquired by ChemChina by week's end. While not as highly publicized as another potential merger in the chemical industry, it could be huge -- with an estimated value in the $45 billion range, or about $3 billion more than the prior offer SYT rejected. Suffice it to say, traders who have been betting bullishly on the stock are sure to be pleased.

As alluded to, SYT is tearing up the charts this afternoon. At last check, the shares are up 7.6% at $78.29, bringing their quarter-to-date gain to almost 22%.

Not surprisingly, traders have been buying to open SYT calls over puts by a considerable margin at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). Specifically, during the last 10 weeks, speculators have bought to open 4.5 times as many calls as puts. As such, the stock's Schaeffer's put/call open interest ratio (SOIR) comes in at 0.43 -- or lower than 64% of comparable readings from the past year.

In today's trading, Syngenta AG (ADR) (NYSE:SYT) calls are once again crossing rapidly. By the numbers, nearly 2,100 calls are on the tape -- roughly eight times the intraday norm -- compared to fewer than 300 puts.

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