Flow Review September 11, 2024: PLTR and DELL join the S&P500, a look back at their options activity beforehand

In this review, we’re going to unusual options activity noted in Palantir Technologies, $PLTR, and Dell Technologies, $DELL.

Both Dell Technologies  and Palantir Technologies ticker experienced a big bounce following news that both companies will join the S&P 500 $SPY. At the time of writing, the $PLTR stock price is up nearly 16% on the month, while $DELL shares are up 12%.

Palantir will replace American Airlines, $AAL, in the ETF, and Dell will replace Etsy, $ETSY.

Both companies experienced unusual options activity caught by Unusual Whales prior to the announcement, and now it appears those traders are sitting comfortably in profit. Let’s take a look first at $PLTR activity.

Using the Unusual Whales Historical Net Premiums, we can see that $PLTR has experienced several instances of sizeable Call-side net premiums (more ask-side call transactions than bid-side transactions) dating all the way back to the beginning of August. This was noted by the Unusual Whales team in real-time. 

The standout days in August were August 6th through 9th, and Net Call Premiums peaked on August 8th, with $8.01 million in net call premium, and -$2.16 million in net put premium. 

CEO of $PLTR, Alex Karp, said in May 2023 “my interest in profitability is for obvious reasons, but… we’ll be in a much stronger position, as it becomes clear that we qualify for participation in the S&P”, which now rings true as $PLTR finds itself amongst the powerhouses in the index. 

Now, let’s take a look at $DELL historical flow.

Much like $PLTR, $DELL also saw a ton of Net Call Premiums in August, dating back to August 5th. On August 13th, Net Call Premiums hit their highest mark at $6.16 million versus only $515,000 net put premium. Some individual contracts do stand out, in Dell’s case.

The $DELL $95 call contract expiring on September 20th saw significant ask-side volume throughout August, with fill prices ranging from as low as $6.78 to $9.38 per contract. Over the course of the next month, the value rose as high as $23.19 per contract. 

The positions were never closed, however, and currently sit at a value of $12.70 per contract. While it’s not the 263% gain it was at the end of August, the position still sits at a roughly 100% profit at the time of writing. Given the fact these contracts are now over 11% in the money, with expiration right at the corner, it’ll be interesting to see if the trader(s) take(s) profit, or if they let these contracts expire and exercise them to acquire shares, as we saw with a $COF trader last month.

For $DELL especially, this S&P inclusion is special, as Dell Technologies was formerly an S&P 500 constituent from 1996 until 2013 when founder Michael Dell, together with Silver Lake equity firm, took the company private. $DELL went public again in 2018, and now in 2024, Dell has made its return, along with $PLTR, to the highly regarded benchmark index. Analyst Ratings on Unusual Whales hold a mostly “Buy” sentiment, with price targets varying wildly from $97 per share, to as high as $218.

NOTE: This post is not financial advice. The stock market is risky, and any trade or investment is expected to have some, or total, loss. Please do research before any trade. Do not use this information for investment decisions. Check terms on site for full terms. Agree to terms before considering this information.