Stocks quoted in this article:
Abercrombie & Fitch (ANF – 26-3/4) sells upscale casual apparel for men, women, and children through a network of 290 stores as well as catalog and online operations. ANF shares struggled between June 1999 and May 2000, depreciating 84 percent during that time frame and sinking into single-digit territory. Since then, however, the equity has been staging a slow recovery. The equity is poised to close January above both its 10-month and 20-month moving averages, a feat it has not achieved since July 1999.
Today, the shares got some help from Wall Street, as two brokerage houses initiated separate coverage on the shares with a "strong buy" and a "buy" rating. Additionally, Merrill Lynch upped its near-term rating on the stock from an "accumulate" to a "buy." The stock is trading more than six percent higher in late-morning trading.
On the options front, 700 contracts have traded on the ANF May 17-1/2 put. Open interest at this out-of-the-money strike stood at only 26 contracts prior to today's trading, suggesting that the bulk of today's volume should translate into new open interest.