Intel Stock Soars Along With Unusual Put Options Activity.jpeg
Intel Company (Intc)) The stocks rose much higher in the recent news that NVIDIA is investing $ 5 billion in the company. But is Intc stock exaggerated now? This heavy activity of the option in INTC stock may indicate today.
Intc is traded in 30.61 dollars On Wednesday, September 24. This rises +21.6 % from $ 24.90 on September 17.
Intc shares – last 3 months – Barchart – September 24, 2025
This is likely to be the result of the NVIDIA Declaration on September 18 that it will invest 5 billion dollars In intc shares at $ 23.28. The company will use the money “… Developing multiple generations of the dedicated data center and custom computer products …”
This market may see as an Intel lifeline. This may mean that NVIDIA will continue to invest in INTC if necessary, although this was not in the press statement.
After all, Intel had a few poor. In the last quarter, it was created -1.5 billion dollars in free cash flow (FCF). This means that its cash balance decreases after all operations, or the debt balance increases.
Before that, FCF was negative for another 6 quarters. In the last seven quarters, INTEL got a $ 23.6 billion cash flow since Q3 2023. This can be observed from the cash flow tab when analyzing stocks.
Last year alone, she generated $ 10.9 billion in a free cash flow, according to stock analysis.
Therefore, until Intel begins to generate positive cash flow, you may need to continue to collect cash. It only has $ 21.2 billion in cash and investments in its public budget, but $ 46 billion in short -term debts.
In other words, with only $ 21 billion in cash, an external flow of $ 11 billion, it remains less than two years of money, without increasing more debts.
For this reason, NVIDIA’s investment can be considered as a lifeline.
However, some may see that this is the probable negative side of the Intel, especially if it should be raised more money until it becomes positive FCF. This may be the reason why the motivation behind the huge activity today.
This can be seen in the Barchart report today Unusual stock options activity. It shows great options trading in INTC shares.
There were more than 10,900 contracts PUT option, which expires 205 days from now on April 17, 2026, which was traded at the price of 28.00 dollars. This is $ 2.61 less than the price of the day of $ 30.61.
Intc puts the expiration of APRI 17, 2026 – Extraordinary Stock Options Activity Report – September 24, 2025
In other words, this strike price is 8.5 % less than the trading price, that is, outside money (OTM). (It is OTM since the PUT option has no value until the trading price decreases below the strike price).
The average paid installment is $ 2.98 for this PUTS. As a result, institutional investors who buy these nails take a long -term view that the InTC shares will decrease by more than 18 % in the next 6.8 months:
28.00 dollars -2.98 dollars = $ 25.02 A tie for buyers status
The downside tie = ($ 25.02 / 30.61 dollars) -1 = 0.817 – 1 = -8.3 %
These buyers are likely to expect that Intel cannot start generating a positive free cash flow during the next two quarters. They expect Intel to raise more debts or shares. INTC can pushed to less.
On the other hand, the short sellers of this apply are good returns:
2.98 dollars / 28.00 dollars = 0.1064 = 10.64 % More than 6.8 months
It works on a monthly return 1.565 % / A month (i.e. 0.1064 dollars/ 6.8). This is not a bad return to income.
Moreover, even if INTC decreases to $ 28.00, its only commitment is to buy intc shares at this price. As a result, their tie is only $ 25.02 per share.
Unless INTC decreases much less than $ 25, they will not have an unreasonable loss. However, there is a good risk that this happens. For example, the Delta percentage is about 33 % that the stock will decrease to $ 28.00.
Moreover, these short sellers may not lose 100 % of their investments (that is, INTC will not decrease to zero), while the buyer put a lot of chance much.
The bottom line is that there are good arguments to buy and shorten these things.
I don’t like buying shares in companies that have a negative empty cash flow (FCF). I think Put option may eventually earn money for their investments.
This does not necessarily mean that INTC will decrease to less than $ 28.00. This means only that the PUT price may eventually rise over the next six months, especially if Intel continues to generate a negative free cash flow.
Be careful in assessing negative risks if you intend to copy this trade.
On the date of publication, Mark R. Hack, CFA parking (either directly or indirectly) in any of the securities mentioned in this article. All information and data in this article are only for media purposes. This article was originally published on Barchart.com
