Among the many retailers to report same-store sales this morning, Buckle, Inc. (BKE - 48.70) said its February same-store sales surged 14.8%, more than doubling analysts' expectations for a more modest 5.8% increase. To boot, the Nebraska-based clothier saw its net sales increase 17.4%, to $86.7 million, from the year ago period.
Thanks to this well-received news, BKE has jumped more than 8% so far today, adding to its roughly 10% year-to-date gain. In the process, the stock reached a new all-time high of $48.92. At last check, the shares are hovering around the $48.50 level, and are well within range of marking their first daily close -- and possibly their first weekly close -- above this level.
Despite this technical strength, it looks as though a number of traders are wagering on BKE's ascent to be short-lived. Short interest inched up about 1% over the most recent reporting period, and now makes up 26% of the the security's available float. At BKE's average pace of trading, it would take more than four weeks to repurchase all of these shorted shares, which could translate into a contrarian boon for the stock.
Elsewhere on the Street, pessimism is teeming in the options pits, as evidenced by BKE's 10-day put/call volume ratio of 18.64 on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio ranks above 89% of all other readings taken during the past year, suggesting that options traders have bought bearish bets over bullish at a faster clip than usual during the past couple of weeks.
Even the brokerage bunch is skeptically slanted toward BKE. Zacks is reporting that six out of seven analysts have doled out a lukewarm "hold" for the stock. What's more, Thomson Reuters places the average 12-month price target at $45.17, which represents a $3.75 discount to today's new peak of $48.92.
In light of BKE's impressive same-store sales, an unwinding of bearish sentiment by any of the brokerages or options players, or a short-squeeze situation, could provide an additional tailwind for the fashion retailer to extend its quest for new historic highs.
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