The shares of Genentech, Inc. (DNA: sentiment, chart, options) are off 0.5% this afternoon after Swiss firm Roche reaffirmed its dividend plans. Ahead of the announcement, speculation was swirling that Roche may suspend its quarterly payouts in order to fund a sweetened bid for DNA. However, a Roche spokesman affirmed that the company is standing by its February 2008 plan to continuously bolster its dividend ratio over the next 3 years.

Previously, DNA rejected an $89-per-share bid from Roche, which already owns a sizable stake in Genentech. The most recent round of rumors called for Roche to raise its offer to $95, but analysts at Morgan Stanley noted today, "We anticipate Roche will ultimately be forced to offer in excess of $100 a share to secure Genentech board approval."

After gaining 2.3% late Friday on renewed M&A speculation, DNA is fractionally lower today. The equity has blazed a steady path higher from its Nov. 21 low atop support from its 10-day moving average, and option players are betting the uptrend will continue. During the past 2 weeks, traders on the International Securities Exchange (ISE) have purchased nearly 5 times more calls than puts on DNA.