Stock traders buy large volume of call options on Wendy’s (NASDAQ:WEN)

Wendy’s Company (NASDAQ:WEN – Get Rating) saw unusual options trading activity on Friday. Investors bought 76,400 call options on the company. This represents a 2,119% increase from the typical daily volume of 3,443 call options.

Wendy’s Institutional Trading

A number of hedge funds have recently increased or reduced their stakes in the company. Millennium Management LLC increased its stake in Wendy’s by 391.3% during the second quarter. Millennium Management LLC now owns 2,397,196 shares of the restaurateur valued at $45,259,000 after purchasing an additional 1,909,235 shares last quarter. Allspring Global Investments Holdings LLC increased its stake in Wendy’s by 86.6% during the second quarter. Allspring Global Investments Holdings LLC now owns 2,683,410 shares of the restaurant owner valued at $50,661,000 after purchasing an additional 1,245,024 shares in the last quarter. Arrowstreet Capital Limited Partnership bought a new position in Wendy’s during the first quarter worth $26,018,000. Renaissance Technologies LLC purchased a new position in Wendy’s during the first quarter worth $23,989,000. Finally, Charles Schwab Investment Management Inc. increased its stake in Wendy’s by 39.8% during the first quarter. Charles Schwab Investment Management Inc. now owns 2,109,753 shares of the restaurateur valued at $46,352,000 after buying an additional 601,122 shares last quarter. 70.88% of the shares are held by hedge funds and other institutional investors.

Wendy’s stock performance

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Wendy’s stock traded at $0.79 at midday on Friday, hitting $20.52. 414,320 shares of the company were traded, against an average volume of 2,294,334. The company has a debt ratio of 8.04, a current ratio of 2.62 and a quick ratio of 2.60. Wendy’s has a fifty-two week low of $15.77 and a fifty-two week high of $24.48. The company has a market capitalization of $4.37 billion, a price-to-earnings ratio of 24.36, a growth price-to-earnings ratio of 2.34 and a beta of 0.92. The company’s fifty-day moving average is $20.28 and its two-hundred-day moving average is $20.01.

Wendy’s (NASDAQ:WEN – Get Rating) last released its quarterly earnings data on Wednesday, August 10. The restaurateur reported EPS of $0.24 for the quarter, beating the consensus estimate of $0.22 by $0.02. The company posted revenue of $537.80 million for the quarter, versus a consensus estimate of $538.85 million. Wendy’s achieved a net margin of 9.08% and a return on equity of 35.49%. The company’s revenue for the quarter increased 9.0% year over year. During the same period of the previous year, the company achieved EPS of $0.27. On average, equity research analysts expect Wendy’s to post earnings per share of 0.85 for the current fiscal year.

Wendy’s announces dividend

The company also recently declared a quarterly dividend, which will be paid on Thursday, September 15. Investors of record on Thursday, September 1 will receive a dividend of $0.125 per share. This represents a dividend of $0.50 on an annualized basis and a yield of 2.44%. The ex-date of this dividend is Wednesday, August 31. Wendy’s dividend payout ratio (DPR) is currently 61.73%.

Analyst upgrades and downgrades

A number of analysts have weighed in on WEN shares recently. Royal Bank of Canada cut its price target on Wendy’s stock from $22.00 to $21.00 and set a “sector performance” rating on the stock in a Thursday, Aug. 11 report. Credit Suisse Group lowered its price target on Wendy’s shares from $27.00 to $22.00 in a Thursday, May 12 research note. Morgan Stanley raised its price target on Wendy’s stock from $22.00 to $24.00 and gave the stock an “equal weight” rating in a Thursday, Aug. 11 research note. BMO Capital Markets raised its price target on Wendy’s shares from $18.00 to $20.00 in a Thursday, August 11 research note. Finally, Sanford C. Bernstein assumed coverage for Wendy’s stock in a research note Wednesday. They set an “outperform” rating and a price target of $25.00 for the company. One equity research analyst gave the stock a sell rating, six gave the company a hold rating and seven gave the company a buy rating. According to data from MarketBeat, Wendy’s has an average rating of “Hold” and an average price target of $25.00.

Wendy’s Company Profile

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The Wendy’s Company, together with its subsidiaries, operates as a fast food restaurant business. It operates through three segments: Wendy’s US, Wendy’s International and Global Real Estate & Development. The company is involved in the operation, development and franchise of a network of quick service restaurants specializing in hamburger sandwiches.

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