The stock was upgraded to Overweight and its price target raised to $ 260
The shares of Visa Inc (NYSE: V) are up 1.8% to trade at $ 234.16 this morning after upgrading Piper Sandler’s security from neutral to overweight and increasing its target price from $ 234 to $ 260. The analyst in the report cited the rapid recovery of the US economy amid increased vaccinations to help the company catch up with the competition. Separately, Visa announced today that it has partnered with Goldman Sachs (GS) to offer cross-border corporate payments.
On the charts, the security has risen, culminating in an April 29 record of $ 237.50. As stocks have since cooled from that high, the pullback has been captured by their 60-day moving average. Despite struggling with resistance at $ 234 today, the stock is still 17.4% ahead of last year.
Analysts were already overwhelmingly bullish on stocks today, with 18 of the 20 in question rated “Buy” or better, while only two said “Hold”. Additionally, the 12 month consensus target of $ 266.79 is a 13.9% premium over current levels.
The option pits reflect that optimism, with an appetite for calls. This corresponds to the 10-day call / put volume ratio of Visa stock of 3.50 on the International Securities Exchange (ISE), the Cboe Options Exchange (CBOE), and the NASDAQ OMX PHLX (PHLX), which shows on the 86th that calls are answered faster than usual.
If you take a closer look at options activity today, 26,000 calls have already run across the tape, three times what you would normally see at this point in time. The most popular is the weekly 6/11 235 strike call, followed by the June 235 call which opens new positions.
Now seems like a good time to bet with options on Visa stock’s next move. The Schaeffer’s Volatility Index (SVI) of 19% for the stock is in the extremely low second percentile of its 12-month range, suggesting that option players are currently pricing in low volatility expectations.