Options Traders Turn Bearish on Macy's Stock Ahead of Earnings

The security is looking at its second-straight daily drop today

Digital Content Manager
Aug 18, 2022 at 1:36 PM
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Macy's Inc (NYSE:M) will join the long list of retailers to recently report earnings, with its numbers for the second quarter due out next week before the open on Tuesday, Aug. 23. The stock is being weighed upon by fellow department store name Kohl's (KSS) gloomy full-year forecast -- last seen down 1.5% at $20.11. This will mark the equity's second-straight daily drop after the equity's rally toward the $21 level was rejected by the 110-day moving average this Tuesday. 

M aug 18

The equity has a history of impressive post-earnings pops, including a 19.3% surge after its May report. In fact, looking back two years, M has managed a next-day win six out of eight times. The security has averaged a 9% next-day swing during this time period, regardless of direction, which is smaller than the 15.1% move options players are pricing in. 

Speaking of options players, Macy's are upping the bearish ante ahead of the retailer's earnings event. During today's session, 17,000 calls and 17,000 puts have been exchanged so far, with puts running at double the volume that's typically seen at this point. The most popular contracts are the August 20 and 20.50 puts, with positions being sold to open at the former. 

There's been a shift toward puts in the options pits. While call volume still outweighs put volume overall, the stock's 50-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits higher than 70% of readings from the past year. Suggesting a healthier-than-usual appetite for these contracts of late. 

 

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