One trader says Cypress Semiconductor having bought $1 million worth of call spreads betting that Cypress stock will be worth $11.33 a share in June. They now stand at $9:90.
Cypress, founded in 1983 by its current CEO T.J. Rodgers, bought Spansion in March and then, in June, engaged in an epic battle with Chinese investors to acquire US memory company ISSI. Cypress offered $750 million for the company.
Eventually a Chinese consortium consisting of Summitview Capital, eTown MemTek; Hua Capital Management, and Hauling Jiye Investment Management, outbid Cypress to win ISSI.
Now Cypress could be on the receiving end. It’s shares have fallen 30% this year making it vulnerable while analysts are giving it an average target price of $13.