Merrill Lynch (NYSE: MER) -
Merrill announced on December 24 it was enhancing its capital position by up to $7.5 billion with agreements to raise up to $6.2 billion through newly issued common stock with Temasek Holdings and Davis Selected Advisors and the sale of ML Capital to GE Capital.
Smith Barney says: "We expect that this is just the beginning of management's actions to sell non-core operations, and we expect these sales will be accretive to ROE."
MER overall option implied volatility of 45 is above its 26-week average of 38 according to Track Data, suggesting larger risk.
Options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com
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