AVAV is flashing a historically bearish signal
Shares of AeroVironment Inc (NASDAQ:AVAV) were last seen down 0.3% at $165.94, sporting a 31.4% year-to-date deficit while drifting back toward last session's 52-week low of $158.30. And looking at options sentiment, a historically bearish signal now flashing indicates the stock's downward momentum could continue.
AeroVironment stock's 10-day call/put volume ratio of 5.76 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) stands higher than 92% of readings from the past year.
This marks the sixth time in the last three years that the equity's 10-day buy-to-open put/call ratio crossed over 1.0 and hit the 90th percentile. Per Schaeffer's Senior Quantitative Analyst Rocky White, AVAV was lower one month later 83% of the time after these signals with an average -4.8% return.
Despite the recent weakness, analyst sentiment remains overwhelmingly positive with 18 "buy" or better ratings and only three "holds." Furthermore, the 12-month consensus price target of $312.70 sits at an 89.5% premium to current levels. This leaves plenty of room for downgrades/price-target cuts that could trigger headwinds moving forward.
What’s more, the security’s Schaeffer's Volatility Scorecard (SVS) comes in at 99 out of 100, meaning the shares have consistently realized higher volatility than its options have priced in over the past 12 months.