Traders Purchase High Volume of Call Options on United Microelectronics (NYSE:UMC)

Key Points

• Unusual options activity: Investors purchased 103,219 UMC call options, 626% above the typical volume of 14,223 contracts, signaling heightened trading interest.
• Shares rose 5.2% to $22.73 during Wednesday trading. UMC recently reported $2.16 billion in quarterly revenue and $0.53 in earnings per share.
• Analyst sentiment remains mixed: Recent firms issued upgrades, but the consensus rating is still “Hold,” with an average price target of $8.60. The company also increased its annual dividend to $0.4122 per share.

United Microelectronics Corporation (NYSE:UMC - Get Free Report) was the target of some unusual options trading on Wednesday. Investors purchased 103,219 call options on the stock. This represents an increase of 626% compared to the typical volume of 14,223 call options.

Analysts Set New Price Targets

A number of research firms recently commented on UMC. Weiss Ratings upgraded United Microelectronics from a "hold (c)" rating to a "hold (c+)" rating in a report on Thursday, July 30th. Arete Research upgraded shares of United Microelectronics from a "neutral" rating to a "buy" rating in a research note on Monday, August 10th. Zacks Research raised shares of United Microelectronics from a "hold" rating to a "strong-buy" rating in a research report on Tuesday, July 28th. BNP Paribas Exane restated an "underperform" rating on shares of United Microelectronics in a research note on Thursday, May 28th. Finally, Wall Street Zen upgraded shares of United Microelectronics from a "hold" rating to a "buy" rating in a research note on Saturday, July 25th. One equities research analyst has rated the stock with a Strong Buy rating, one has given a Buy rating, one has assigned a Hold rating and three have assigned a Sell rating to the company's stock. According to MarketBeat.com, the company has a consensus rating of "Hold" and a consensus price target of $8.60.

United Microelectronics Stock Up 5.2%

Shares of NYSE UMC traded up $1.12 during mid-day trading on Wednesday, reaching $22.73. 3,897,326 shares of the company traded hands, compared to its average volume of 13,453,948. The company's fifty day moving average is $20.41 and its two-hundred day moving average is $17.31. The company has a debt-to-equity ratio of 0.10, a quick ratio of 1.81 and a current ratio of 2.17. United Microelectronics has a fifty-two week low of $6.82 and a fifty-two week high of $28.96. The stock has a market cap of $57.24 billion, a PE ratio of 21.24, a price-to-earnings-growth ratio of 0.51 and a beta of 1.59.

United Microelectronics (NYSE:UMC - Get Free Report) last announced its earnings results on Tuesday, June 30th. The semiconductor company reported $0.53 earnings per share (EPS) for the quarter. United Microelectronics had a return on equity of 21.00% and a net margin of 33.18%.The firm had revenue of $2.16 billion during the quarter. On average, analysts expect that United Microelectronics will post 1.23 earnings per share for the current year.

United Microelectronics Increases Dividend

The company also recently disclosed an annual dividend, which was paid on Thursday, August 6th. Investors of record on Wednesday, July 8th were issued a dividend of $0.4122 per share. The ex-dividend date of this dividend was Wednesday, July 8th. This represents a dividend yield of 166.0%. This is an increase from United Microelectronics's previous annual dividend of $0.37. United Microelectronics's payout ratio is currently 28.97%.

Institutional Investors Weigh In On United Microelectronics

A number of hedge funds have recently bought and sold shares of UMC. Dimensional Fund Advisors LP lifted its position in shares of United Microelectronics by 13.2% during the 1st quarter. Dimensional Fund Advisors LP now owns 2,849,737 shares of the semiconductor company's stock worth $25,591,000 after purchasing an additional 333,011 shares during the last quarter. Matthews International Capital Management LLC bought a new position in United Microelectronics in the 1st quarter worth approximately $8,779,000. Moran Wealth Management LLC increased its position in United Microelectronics by 14.9% in the 1st quarter. Moran Wealth Management LLC now owns 910,416 shares of the semiconductor company's stock worth $8,176,000 after buying an additional 118,049 shares during the period. Quantinno Capital Management LP lifted its holdings in shares of United Microelectronics by 17.9% during the first quarter. Quantinno Capital Management LP now owns 710,604 shares of the semiconductor company's stock worth $6,381,000 after buying an additional 108,050 shares during the last quarter. Finally, LSV Asset Management boosted its position in shares of United Microelectronics by 22.7% in the fourth quarter. LSV Asset Management now owns 694,211 shares of the semiconductor company's stock valued at $5,456,000 after acquiring an additional 128,600 shares during the period. 5.05% of the stock is currently owned by institutional investors.

About United Microelectronics

United Microelectronics Corporation NYSE: UMC is a Taiwan-based semiconductor foundry that manufactures integrated circuits for customers that design and market their own chips. The company provides wafer fabrication services rather than selling semiconductor products under its own consumer brand.

UMC supports a broad range of applications, including communications, automotive systems, industrial equipment, consumer electronics and computing. Its manufacturing portfolio includes logic and mixed-signal technologies, radio-frequency processes, embedded high-voltage solutions, display-driver chips, image sensors and other specialty semiconductor technologies.

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