Traders Purchase Large Volume of GSK Call Options (NYSE:GSK)

Key Points

• Investors bought 38,005 call options on GSK (NYSE:GSK) in one day, a 717% jump versus the average daily call volume of 4,654.
• Analysts remain largely cautious: the consensus rating is Reduce with an average target price of $53.00 and a broker split of 1 Buy, 6 Hold and 3 Sell.
• GSK recently raised its quarterly dividend to $0.4856 (from $0.42), equating to an annualized $1.94 and a 3.6% yield, while shares traded at $54.55 and the company has a $110.69 billion market cap.

GSK PLC Sponsored ADR (NYSE:GSK - Get Free Report) was the target of some unusual options trading activity on Tuesday. Investors bought 38,005 call options on the stock. This represents an increase of 717% compared to the average daily volume of 4,654 call options.

Analyst Upgrades and Downgrades

Several research firms have recently weighed in on GSK. Weiss Ratings lowered shares of GSK from a "buy (b-)" rating to a "hold (c+)" rating in a report on Thursday, March 19th. Barclays reaffirmed an "underweight" rating on shares of GSK in a report on Friday, February 20th. TD Cowen reaffirmed a "hold" rating on shares of GSK in a report on Monday, February 9th. Deutsche Bank Aktiengesellschaft reaffirmed a "hold" rating on shares of GSK in a report on Friday, January 16th. Finally, Wall Street Zen cut GSK from a "strong-buy" rating to a "buy" rating in a research report on Saturday, March 7th. One equities research analyst has rated the stock with a Buy rating, six have given a Hold rating and three have assigned a Sell rating to the company's stock. According to MarketBeat, the stock currently has an average rating of "Reduce" and a consensus target price of $53.00.

Institutional Investors Weigh In On GSK

A number of large investors have recently modified their holdings of GSK. Fisher Asset Management LLC grew its holdings in shares of GSK by 3.0% during the fourth quarter. Fisher Asset Management LLC now owns 33,195,985 shares of the pharmaceutical company's stock worth $1,627,931,000 after buying an additional 968,370 shares in the last quarter. BI Asset Management Fondsmaeglerselskab A S grew its holdings in shares of GSK by 2,032.8% during the fourth quarter. BI Asset Management Fondsmaeglerselskab A S now owns 854,331 shares of the pharmaceutical company's stock worth $41,896,000 after buying an additional 814,275 shares in the last quarter. PFA Pension Forsikringsaktieselskab purchased a new stake in shares of GSK during the fourth quarter worth $6,385,000. Align Financial LLC purchased a new stake in shares of GSK during the fourth quarter worth $5,628,000. Finally, Leuthold Group LLC purchased a new stake in shares of GSK during the fourth quarter worth $4,922,000. Hedge funds and other institutional investors own 15.74% of the company's stock.

GSK Price Performance

NYSE GSK traded up $0.33 on Tuesday, hitting $54.55. The company had a trading volume of 6,749,799 shares, compared to its average volume of 5,184,798. The company has a market capitalization of $110.69 billion, a PE ratio of 14.74, a PEG ratio of 3.20 and a beta of 0.46. The company's fifty day moving average price is $56.27 and its 200-day moving average price is $51.54. The company has a debt-to-equity ratio of 0.92, a current ratio of 0.82 and a quick ratio of 0.54. GSK has a 12-month low of $35.45 and a 12-month high of $61.69.

GSK Increases Dividend

The firm also recently announced a quarterly dividend, which was paid on Thursday, April 9th. Stockholders of record on Friday, February 20th were issued a dividend of $0.4856 per share. The ex-dividend date of this dividend was Friday, February 20th. This is a positive change from GSK's previous quarterly dividend of $0.42. This represents a $1.94 dividend on an annualized basis and a dividend yield of 3.6%. GSK's payout ratio is currently 50.81%.

About GSK

GSK (GlaxoSmithKline plc) is a London-headquartered, multinational pharmaceutical and healthcare company formed through the 2000 merger of Glaxo Wellcome and SmithKline Beecham. The company is dual-listed and operates globally, developing, manufacturing and commercializing prescription medicines, vaccines and specialty treatments. Over its history GSK has evolved through portfolio reshaping and strategic transactions to focus on science-led pharmaceuticals and vaccines.

GSK's core activities include research and development of therapies and vaccines across a range of therapeutic areas, commercial manufacturing, and global marketing.

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