VNET Group Surges 13.8% on 40MW Order and Analyst Upgrades—What’s Fueling This Rally?

Summary
• VNET Group (VNET) surges 13.8% to $10.64, driven by a 40MW wholesale order and analyst upgrades.
• Q1 2025 revenue hits RMB2.25 billion ($309.5 million), with wholesale revenue up 86.5% YoY.
• Bank of America raises price target to $12.60, while Wall Street Zen downgrades to 'sell'.

VNET Group’s stock has erupted 13.8% intraday, trading at $10.64 as of 7:14 PM ET. The surge follows a landmark 40MW wholesale order, robust Q1 earnings, and conflicting analyst ratings. With a 52-week high of $16.13 still in reach, investors are scrambling to decode whether this is a short-term pop or a breakout for the data center giant.

40MW Order and Analyst Upgrades Ignite Short-Term Frenzy
VNET’s 13.8% intraday surge is directly tied to two catalysts: a 40MW wholesale order from a major internet company and a flurry of analyst upgrades. The order, disclosed in a PR Newswire release, adds to existing 119MW of wholesale commitments in Q1 2025, signaling strong demand for VNET’s data center capacity. Meanwhile, Bank of America raised its price target to $12.60 (from $11.80), while Wall Street Zen downgraded to 'sell', creating a volatile mix of optimism and caution. The stock’s gap-up from $9.35 to $9.97 at open further underscores immediate institutional buying pressure.

Options Playbook: High-Leverage Calls and Gamma-Driven Bets
• MACD: 0.494 (bullish divergence from signal line 0.393)
• RSI: 62.6 (neutral, not overbought)
• Bollinger Bands: Price at $10.64 (above upper band $10.50)
• 200D MA: $7.42 (price at 42% above)
• Key Resistance: $10.85 (intraday high), $11.00 (psychological level)
• Support: $9.94 (intraday low), $9.35 (previous close)

VNET’s technicals suggest a continuation of the rally, with the RSI and MACD favoring bullish momentum. The stock is trading 42% above its 200-day average, indicating a strong breakout. For options traders, the VNET20251017C10 and VNET20251017C11 contracts stand out:

• VNET20251017C10
- Strike: $10.00
- Delta: 0.640 (high sensitivity to price moves)
- Gamma: 0.1355 (accelerating delta as price rises)
- IV: 101.71% (elevated but not extreme)
- Turnover: $953,790 (liquid)
- Leverage: 7.56% (moderate)
- Theta: -0.0307 (time decay manageable)
- Payoff at 5% upside ($11.17): $1.17 per contract
- Why it works: High delta and gamma make this ideal for a continuation of the rally, with liquidity ensuring easy entry/exit.

• VNET20251017C11
- Strike: $11.00
- Delta: 0.503 (balanced sensitivity)
- Gamma: 0.1366 (strong acceleration potential)
- IV: 107.62% (high volatility)
- Turnover: $1.187 million (high liquidity)
- Leverage: 10.59% (aggressive)
- Theta: -0.0317 (moderate time decay)
- Payoff at 5% upside ($11.17): $0.17 per contract
- Why it works: High leverage and gamma position this for a sharp move if VNET breaks above $11.00, with turnover ensuring execution.

Action: Aggressive bulls should target VNET20251017C10 for a 5% upside scenario. Conservative traders may use VNET20251017C11 as a directional bet, but monitor the $10.85 intraday high for a breakout confirmation.

Backtest VNET Group Stock Performance
The historical impact of a ≥ 14 % intraday jump in VNET (VNET.O) since 2022 has been quantified: 19 events show a mildly positive but statistically insignificant drift over the following month. 1-day to 30-day average excess returns versus the benchmark remain small (≤ 5 %) and lack significance, while single-day win rates hover near 50 %. Overall, the surge has not provided a reliable trading edge.Please review the interactive event-backtest report for full metrics, trade-by-trade data, and charts.Key takeaways:• Average 5-day excess return: +1.6 % (not significant) • Peak excess return appears near day 6 (~+5 %) but fades thereafter. • Win rate rarely exceeds 58 %, insufficient for standalone trading. You can drill down inside the module for individual event charts and distribution plots.

VNET’s Rally: A Short-Term Pop or a New Trend?
VNET’s 13.8% surge is a mix of short-term order flow and analyst-driven optimism, but sustainability hinges on maintaining momentum above $10.85. The stock’s 42% premium to its 200-day average and elevated RSI suggest a strong near-term trend, though the lack of a clear economic moat (per Morningstar) raises long-term concerns. Investors should watch the $9.94 support level and the sector leader Equinix (EQIX), which fell 1.8% today, for broader market signals. For now, VNET20251017C10 offers the best high-leverage play if the $11.00 level is cleared. Act now: Buy VNET20251017C10 into a break above $10.85 for a 5% upside target.