Options Bulls Flock to DAL Stock Ahead of Earnings

The stock is bumping up against recent resistance at the $60 region

Digital Content Manager
Jan 13, 2020 at 2:59 PM
facebook X logo linkedin

Travel concern Delta Air Lines, Inc (NYSE:DAL) is once again bumping up against recent pressure at its $60 region, just ahead of its fourth-quarter earnings report, due out before the open tomorrow. In the past, DAL has tended towards positive returns the day after its quarterly report, with only one post-earnings move during the past two years falling into negative territory (a 1.5% dip last October, specifically). During these last eight next-day sessions, Delta has averaged a move of 2.2%, regardless of direction. This time around, the options pits are pricing in a slightly bigger swing of 5.3%. 

Speaking of options pits, they are brimming with activity today, with 33,000 calls and 17,000 puts across the tape so far -- three times what's typically seen at this point. The January 2020 60-strike call is the most popular. It also looks like positions are being opened at the January 2020 62-strike call for a volume-weighted average price (VWAP) of 23 cents. This means traders will profit if the stock rises above $62.23 (strike plus premium paid) by the time these contracts expire this Friday. 

This uptick in bullish bets is nothing new. At the the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), 3.2 calls have been picked up for every put during the past 10 days. This ratio sits higher than 83% of all other readings from the past year, too, suggesting this preference for calls is unusual. 

There are still quite a few holdouts among the brokerage bunch, however. Six of the 13 in coverage call the stock a tepid "hold." Meanwhile, the consensus-12 month target price of $67.26 is a 13.7% premium to current levels. 

At last glance, DAL is up 0.5% to trade at $59.32 and pacing for its fourth consecutive win. Looking more broadly, recent support has emerged for the security at its 100-day moving average, which previously acted as a layer of resistance on the charts. Year-over-year, Delta is up 21.8%. 

DAL Jan 13


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