Earnings Preview: Macy's, Inc. and Etsy Inc

Macy's, Inc. (NYSE:M) and Etsy Inc (NASDAQ:ETSY) have had a recent history of poor post-earnings performances

Feb 22, 2016 at 3:17 PM
facebook X logo linkedin


Retailer Macy's, Inc. (NYSE:M) and e-tailer Etsy Inc (NASDAQ:ETSY) will report earnings tomorrow. Let's take a pre-earnings look at M and ETSY. 

  • is scheduled to report fourth-quarter results before the bell on Tuesday, and it's hoping this time goes better than its previous releases. For instance, the stock hasn't experienced a positive post-earnings session since November 2014. Despite this, call buying has been popular leading up to the event. The stock's 50-day call/put volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) comes in at 2.75, just 2 percentage points from an annual high. Meanwhile, the options market is pricing in a 12% post-earnings swing for M. For the sake of comparison, M has averaged a 5.2% move in the session subsequent to earnings, looking back over the past eight quarters. 

    On the charts, Macy's, Inc. has been sliding fast since its record high of $73.61 in July, with the shares last seen at $40.95, a more than 44% decline. If this trend continues, analyst downgrades -- on top of an unwinding of the bullish option trader sentiment -- could exacerbate the stock's losses. Of the 14 brokerage firms with coverage on M, three maintain a "strong buy" recommendation, while nine sit right on the fence with a "hold" rating. This morning, though, Sterne Agee CRT upped its price target to $43 from $42. 
  • ETSY will announce its fourth-quarter results after the close tomorrow, marking the fourth time the company has stepped into the earnings booth since going public last April. After its first three earnings releases, the stock posted losses of 18.1%, 28.3%, and 9.6%, for an average post-earnings plunge of 18.7%. This time around, speculators are pricing in a 21.4% single-session post-earnings swing from the shares. 

    Similar to M, traders have taken a decidedly call-skewed approach to ETSY. Over the past 10 days at the ISE, CBOE, and PHLX, more than 1,300 calls have been bought to open, compared to just 57 puts. Technically speaking, Etsy Inc's plummeted 78% since its April 16 all-time peak of $35.74. Today, though, it's edged higher to trade at $7.95, despite a price-target cut to $10 from $11 at Goldman Sachs -- which also weighed in on Amazon.com, Inc. (NASDAQ:AMZN).
Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical  levels, and top economic stories straight to your inbox.
 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI