History Says to Buy the Dip on Outperforming Crocs Stock

CROX may also be due for a round of analyst upgrades

Managing Editor
Sep 5, 2018 at 3:00 PM
facebook X logo linkedin

Shares of Crocs, Inc. (NASDAQ:CROX) are down 1.8% at $20.41 in late-afternoon trading amid broad-market headwinds. However, the footwear manufacturer is well into its long-term uptrend, and per data from Schaeffer's Senior Quantitative Analyst Rocky White, now may be the perfect time to bet on Crocs stock's next leg higher with options. 

CROX has been marching higher since dipping below $6 back in May 2017, thanks to steady support at its rising 100-day moving average -- a trendline that's contained several pullbacks this calendar year. Plus, the stock touched a fresh six-year high of $21.24 just last Friday, Aug. 31, and has picked up 128% over the past 12 months.

Daily Chart of CROX Since September with 100MA 

Digging deeper, Crocs stock's short-term options are attractively priced right now. CROX's Schaeffer's Volatility Index (SVI) of 41% is in just the 9th percentile of its annual range, suggesting near-term options are pricing in relatively low volatility expectations.

Per White, there have been four other times since 2008 CROX stock was trading near new highs when its SVI was simultaneously perched in the lower 20th percentile of its 12-month range. After these signals, the shares were higher 100% of the time one month later, and up an average of 7.8%.

A shift in sentiment among options traders could create tailwinds for CROX, too. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows CROX with a 10-day put/call volume ratio of 2.55, ranking in the 96th percentile of its annual range, meaning puts have been bought to open over calls at a quicker-than-usual clip. 

Plus, Crocs stock's Schaeffer's put/call open interest ratio (SOIR) of 2.14 ranks in the 88th percentile of its annual range. This indicates that short-term traders have rarely been more put-heavy toward the security in the past year.

Lastly, the outperforming equity may be overdue for upgrades, which could draw more buyers to the table. Of the six brokerages covering CROX, just one maintains a "buy" rating.


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