Bullish options flow was detected in VALE stock on December 1, 2020.
Make sure to review this lesson on options trading so that you understand the chart above.
Bullish option flow was detected in Vale with 35,694 calls trading, 4x expected, and implied vol increasing over 7 points to 47.22%. Dec-20 $15.50 calls and Dec-20 $16 were the most active options, with total volume in those strikes over 10,900 contracts.
On November 25, 2020, Scotiabank analyst Alfonso Salazar raised the firm’s price target on Vale to $17 from $16 and kept an Outperform rating on the shares. Investors who consider Vale as an iron ore producer facing a commodity price contraction ahead and a still-pending settlement with the authorities “would be missing the full picture,” said Salazar, who thinks investors should consider Vale’s “attractive” dividend yield, exposure to a “highly attractive copper portfolio,” and long-term optionality on the EV revolution through its nickel assets, the analyst said.
The electric vehicle market has had some bumps in the road, but the industry has continued to move forward and to succeed by continually adapting… but their need for newer and better batteries and cells is an ever changing task… and the “recipe” of their energy cells is also evolving. Previously, according to the Wall Street Journal, one standard form of cathode—the most valuable part of an automotive-grade lithium-ion battery—used to contain equal parts of nickel, cobalt and manganese. Now it has eight parts of nickel to each one of the other two metals. A recent article in industry insider, future Net Zero, said that the sustainable nickel supply is becoming ‘serious issue’ for EV market and that EV powertrains are putting ‘sudden and unprecedented strain on several raw materials industries’… especially nickel.