Traders Buy Large Volume of VALE Call Options (NYSE:VALE)

Key Points

• Vale (NYSE:VALE) experienced a significant increase in call options trading, with 240,906 call options purchased, representing a 714% surge compared to average trading volume.
• Institutional investors, including American Century Companies and Rhumbline Advisers, have recently increased their stakes in Vale, demonstrating growing confidence in the company's prospects.
• The company reported a quarterly EPS of $0.50, exceeding estimates, despite lower-than-expected revenue of $8.80 billion, while also announcing a semi-annual dividend of $0.3417 per share.

VALE S.A. (NYSE:VALE - Get Free Report) was the target of unusually large options trading on Tuesday. Stock traders bought 240,906 call options on the stock. Thisrepresentsanincreaseofapproximately714% compared to the typical daily volume of 29,589 call options.

Wall Street Analysts Forecast Growth

A number of research analysts recently commented on the company. CICC Research initiated coverage on VALE in a report on Monday, May 12th. They issued an "outperform" rating and a $11.30 price target for the company. Wall Street Zen started coverage on VALE in a report on Wednesday, May 7th. They issued a "hold" rating on the stock. Scotiabank lowered their price objective on VALE from $13.00 to $12.50 and set a "sector perform" rating for the company in a research note on Tuesday, July 22nd. Barclays raised their target price on VALE from $12.75 to $13.00 and gave the company an "overweight" rating in a research note on Wednesday, July 2nd. Finally, UBS Group restated a "neutral" rating and set a $10.00 price target (up previously from $9.00) on shares of VALE in a research report on Monday, August 4th. Six equities research analysts have rated the stock with a hold rating and five have assigned a buy rating to the company's stock. According to MarketBeat, VALE presently has a consensus rating of "Hold" and an average target price of $11.84.

Institutional Inflows and Outflows

A number of hedge funds have recently made changes to their positions in the stock. GQG Partners LLC acquired a new stake in shares of VALE during the 1st quarter worth approximately $371,778,000. Invesco Ltd. lifted its position in VALE by 1,534.8% in the second quarter. Invesco Ltd. now owns 24,810,285 shares of the basic materials company's stock worth $240,908,000 after purchasing an additional 23,292,629 shares during the period. Orbis Allan Gray Ltd boosted its stake in VALE by 165.9% during the first quarter. Orbis Allan Gray Ltd now owns 31,257,989 shares of the basic materials company's stock worth $311,955,000 after buying an additional 19,500,437 shares in the last quarter. Lazard Asset Management LLC increased its holdings in VALE by 49.3% in the 4th quarter. Lazard Asset Management LLC now owns 18,238,313 shares of the basic materials company's stock valued at $161,773,000 after buying an additional 6,023,144 shares during the period. Finally, Price T Rowe Associates Inc. MD increased its holdings in VALE by 20.5% in the 4th quarter. Price T Rowe Associates Inc. MD now owns 33,995,398 shares of the basic materials company's stock valued at $301,541,000 after buying an additional 5,775,590 shares during the period. Institutional investors and hedge funds own 21.85% of the company's stock.

VALE Price Performance

Shares of NYSE VALE remained flat at $9.91 during mid-day trading on Friday. 19,514,560 shares of the company were exchanged, compared to its average volume of 46,042,572. VALE has a fifty-two week low of $8.06 and a fifty-two week high of $12.05. The firm has a market capitalization of $44.98 billion, a price-to-earnings ratio of 8.06 and a beta of 0.74. The company has a fifty day moving average of $9.81 and a two-hundred day moving average of $9.63. The company has a debt-to-equity ratio of 0.48, a quick ratio of 0.85 and a current ratio of 1.22.

VALE (NYSE:VALE - Get Free Report) last announced its quarterly earnings data on Thursday, July 31st. The basic materials company reported $0.50 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.34 by $0.16. The company had revenue of $8.80 billion for the quarter, compared to analysts' expectations of $9.54 billion. VALE had a net margin of 14.23% and a return on equity of 18.14%. As a group, analysts predict that VALE will post 1.85 EPS for the current fiscal year.

VALE Cuts Dividend

The firm also recently disclosed a semi-annual dividend, which will be paid on Wednesday, September 10th. Investors of record on Wednesday, August 13th will be issued a $0.3417 dividend. The ex-dividend date is Wednesday, August 13th. This represents a yield of 740.0%. VALE's dividend payout ratio is currently 58.54%.

VALE Company Profile

Vale SA, together with its subsidiaries, produces and sells iron ore and iron ore pellets for use as raw materials in steelmaking in Brazil and internationally. The company operates through Iron Solutions and Energy Transition Materials segments. The Iron Solutions segment produces and extracts iron ore and pellets, manganese, and other ferrous products; and provides related logistic services.