C3.AI stock has a history of negative post-earnings reactions
Artificial intelligence (AI) name C3.ai (NYSE:AI) will announce fiscal fourth-quarter earnings after the close on Wednesday, May 29. C3.ai stock sports a 9.5% year-to-date deficit despite all the rage surrounding the AI space. Still, the equity bounced 25.4% over the last 30 days, and is now trading well above its April 16, 12-month low of $20.23. At last check, AI is down 1.8% at $26.03.
The stock has a negative history of post-earnings reactions, finishing five of its past eight next-day sessions lower, though it bounced 24.5% after its February earnings call. The shares averaged a move of 15.8% in the past two years, regardless of direction, but the options pits are pricing in a slightly lower swing of 15.6% this time around.
Options traders are bullish ahead of the event. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 50-day call/put volume ratio of 3.71 stands higher than all other readings in its annual range. This indicates long calls have been getting picked up at a faster-than-usual clip in the past 10 weeks.
It's also worth noting that short interest is up 4.9% in the last reporting period, and the 33.40 million shares sold short make up a 31.2% of the stock's available float. It would take shorts nearly one week to buy back their bets, at AI's average pace of daily trading.