Bunge Stock Poses Attractive Entry Point for Bulls

The stock's underlying price is relatively low compared to its earnings

May 3, 2022 at 11:45 AM
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The shares of Bunge Ltd (NYSE:BG) continue to move higher on the charts, now up 21.2% year-to-date and 32.4% higher year-over-year, with support recently emerging at the security's 40-day moving average. Further, an April 27 financial report saw the company beat first-quarter earnings, revenue, and guidance expectations. The stock boasts a price-to-earnings (P/E) ratio of 8.7, which makes now the perfect time to initiate a new long position on BG as its underlying price is relatively low compared to its earnings.

BG WT Repost

Bunge stock's implied volatility (IV) is beginning to decrease following the earnings event. Even better, the equity tended to exceed volatility expectations in the past year, per its Schaeffer's Volatility Scorecard (SVS) of 97 out of 100.

A shift in analyst sentiment could provide additional tailwinds for BG, too. Of the four brokerage firms covering the stock, just one recommends a "strong buy," versus three that say "hold."
 
Our recommended call option has a leverage ratio of 7.3, and will double on a 13.3% pop in the underlying stock.
 
Subscribers to Schaeffer's Weekend Trader options recommendation service received this BG commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.
 

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