Upside option positions are delivering massive profits in Jumia Technologies AG (JMIA).
On Jun. 30, Market Rebellion’s Unusual Activity Service identified the purchase of 20,000 July 11th $4 call options bought for $0.25 per contract, with JMIA shares trading at $3.89, significantly exceeding the strike’s previous open interest of 84 contracts.
Those July $4 calls have traded as high as $0.80 today with the stock at $4.68, delivering impressive returns of approximately 220.00% from the initial entry price of $0.25. Meanwhile, JMIA shares have gained approximately 20.31% from their initial trading level around $3.89, demonstrating how options can deliver significantly amplified returns compared to simply owning the underlying stock.
This performance illustrates the power of options leverage when the directional thesis proves correct, though it’s important to note that this same leverage can work against traders when market moves go in the opposite direction.
The explosive move in JMIA comes as Jumia Technologies AG, the biggest e-commerce company in Africa, has drawn takeover interest from telecommunications company Axian Telecom, according to a Bloomberg report published today. According to Bloomberg, citing people familiar with the matter, Axian Telecom recently raised $600 million to refinance its debt and potentially fund an acquisition of Jumia. Deliberations are reportedly ongoing and private, with no definitive agreement reached, per Bloomberg. This potential merger follows Axian’s disclosure in May of an 8% stake in Jumia.
Such an acquisition could create a powerful synergy, combining Axian’s telecommunications infrastructure with Jumia’s e-commerce platform across the African continent. The potential deal would represent a significant strategic move in Africa’s rapidly evolving digital economy landscape.
Jumia Technologies specializes in e-commerce operations across Africa, positioning itself as the continent’s leading online marketplace. The company operates an integrated ecosystem that includes e-commerce, logistics, and fintech services, serving millions of customers across multiple African markets. The potential acquisition by Axian Telecom, which operates telecommunications infrastructure across nine African countries, would create significant operational synergies between telecommunications and e-commerce services.
JMIA was last at $4.62, up 15.05% on the day and up from the $3.89 level when the original call activity was spotted.
