Google Parent's Market Cap Hits $3 Trillion, Boosting Appeal of Call Options: Options Chatter

Luzi Ann Santos joined discussion · Sep 16 01:40

$Alphabet-A (GOOGL.US)$ options volume jumped Monday as the market capital of Google's parent company climbed to $3 trillion, becoming only the fourth U.S. stock to reach that milestone.

Shares advanced 4.5% to close at $251.61 amid a growing number of analysts raising their price target on the stock after a U.S. district court issued less-severe-than-expected remedies in the antitrust case against Google.

The court decision, issued earlier this month, eased concerns that Alphabet could be required to divest Chrome or Android, a risk that has weighed on the stock. That put the company in the same league as $NVIDIA (NVDA.US)$, $Microsoft (MSFT.US)$ and $Apple (AAPL.US)$, whose market capital hit that milestone before climbing higher.

(To see Alphabet A share’s options chain, click here. For the options ranking led by Tesla, Nvidia and Opendoor, click here.)

Google Parent's Market Cap Hits $3 Trillion, Boosting Appeal of Call Options: Options Chatter

(To see Alphabet share class C's stock option chain, click here. For the U.S. stock options page, click here.)

About 810,700 call and put options tied to Alphabet A shares changed hands Monday, up from 380,190 contracts traded in the previous session. Volume on options linked to $Alphabet-C (GOOG.US)$'s C shares rose to 441,350, from 190,040 last Friday.

That landed Alphabet in third place among the most active stock options, behind Tesla’s 3.48 million contracts, and Nvidia’s 1.88 million. The total for Alphabet's A and C shares were higher than Opendoor’s 1.15 million options traded.

On Monday, Citigroup raised its price target on Alphabet to $280, from $225. That came days after JPMorgan analysts including Doug Anmuth boosted their target price to $260, from $232, noting that the court decision will allow investors to “comfortably shift their focus to Google fundamentals.”

“The long awaited Google Search Commercial Agreement remedies announced Tuesday afternoon were much more favorable for Google than anticipated,” the JPMorgan analysts wrote in a note after the decision was released earlier this month. “We expect mostly status quo as Google Search will likely remain the preloaded default search option across access points.”

Call options that give their holder the right to buy class A shares at $250 each attracted the heaviest trading as stock climbed above that strike price to end Monday at $251.61.

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