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Toy, game, and children's apparel retailer Toys ‘R' Us (TOY – 25.20) announced fourth-quarter earnings this morning of $1.23 per share, inching past the consensus Wall Street estimate by a penny. The company also noted that it sees same-store sales growth of three percent in 2001, during which it will additionally open 20 new Babies ‘R' Us locations. Finally, TOY officials said they are comfortable with current analysts' estimates for the full fiscal year.
TOY is trading more than four percent in the black in early trading. This has taken the shares solidly above previous resistance at their 10-day and 20-day moving averages and put them within striking distance of their annual high in the 26-27 region.
With the shares now above all significant moving averages and within a chip-shot of new high territory, it is a wonder that the speculative crowd continues to assert its pessimistic sentiment on the shares. Schaeffer's put/call open interest ratio (SOIR) for TOY stands at 1.06, meaning that total put open interest outweighs total call open interest for all options expiring within the next three months. This SOIR reading ranks in the upper five percent of all ratios taken over the past 52 weeks, a sign that pessimism from the options crowd, like the stock itself, is near an annual peak.