Call Traders Speculate on MMM Ahead of Earnings

Call volume is running at double the intraday average

Deputy Editor
Jul 26, 2021 at 2:22 PM
facebook twitter linkedin


The shares of 3M Company (NYSE:MMM) are up 0.9%, last seen trading at $202.31 as the company gears up for its second-quarter earnings, due out ahead of the open tomorrow, July 27. Below, we'll dig into the stock's technical setup and take a look at how the equity has fared after earnings in the past. 

On the charts, MMM has struggled to find direction since notching a May 5, two-year high of $208.95, which is the same time and price point of a bear gap the equity suffered after being rejected by the $220 level. 3M stock once again has support from the 80-day moving average, and boasts a 26.7% year-over-year lead.

MMM Chart July 26

Call traders are bombarding the blue-chip name ahead of the event. So far today, 8,022 calls have exchanged hands, which is double the amount typically seen at this point, versus 2,970 puts. The September 210 call is the most popular, followed by the August 210 call. This implies that these traders see plenty of upside for 3M stock heading into the latter part of the year.

And that long-term speculation seems like the right call, given that MMM has a history of negative post-earnings reactions. In the last eight reports, 3M stock has logged a positive next-day move just three times. The security has averaged a post-earnings move of 3.4%, regardless of direction. This time around, the options market is pricing in a slightly larger 5.2% move for the stock.

 

If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!

 


 


 
Special Offers from Schaeffer's Trading Partners