Schaeffer's Trading Floor Blog

Citigroup Inc (C) Call Buying Hits Extreme Level

Option bulls have taken a liking to C in recent weeks

by 1/3/2014 2:30 PM
Stocks quoted in this article:

Citigroup Inc (NYSE:C) has been a popular target among call buyers of late. At the International Securities Exchange (ISE) and Chicago Board Options Exchange (CBOE), the financial stock has seen 10,368 calls bought to open during the past five sessions, compared to just 2,654 puts. The result is a five-day call/put volume ratio of 3.91.

Expanding the time frame to two weeks, and adding data from the NASDAQ OMX PHLX (PHLX), yields an even stronger bias toward calls relative to puts. Specifically, C has racked up a 10-day ISE/CBOE/PHLX call/put volume ratio of 6.91 -- higher than all similar readings taken in the last 52 weeks. In other words, traders have scooped up long calls over puts at an annual-extreme pace.

This bullish bias is witnessed outside of the options pits, as well. For instance, Citigroup is currently covered by 18 analysts; from them, it has received 14 "buy" or better ratings, and just four "hold" or worse suggestions. What's more, the consensus 12-month price target of $59.96 is a healthy 13.4% higher than the security's current price of $52.89.

Elsewhere, on the charts, C sports a year-over-year gain of roughly 26%. What's more, a pullback last October and November was cushioned by the shares' 40-week moving average, which helped lift the equity to a multi-year high of $53.68 on Nov. 25.

Fundamentally, Citigroup Inc (NYSE:C) is scheduled to report fourth-quarter earnings before the market opens on Thursday, Jan. 16. Analysts are expecting a per-share profit of $1.05.

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