Zillow Group, Inc. (Z) Buyout Buzz Excites Call Buyers

Zillow Group Inc (NASDAQ:Z) is muscling higher on buyout buzz

Jun 19, 2015 at 3:14 PM
facebook X logo linkedin


Zillow Group Inc (NASDAQ:Z) is sharply higher this afternoon, amid unconfirmed rumors the real estate company may be a buyout target. Among the potential suitors are Google Inc (NASDAQ:GOOGL), and possibly even Facebook Inc (NASDAQ:FB) -- following glowing comments from Z CEO Spencer Rascoff. This is likely welcome news for recent call buyers -- of which there have been many.

Specifically, during the last two weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Z has racked up a call/put volume ratio of 2.36. Not only does this reading indicate more than two calls have been bought to open for every put, it also ranks higher than nine-tenths of comparable metrics from the past year.

Not everyone is so convinced about Z's prospects. For one, over 36% of the stock's float is sold short -- representing more than 12 sessions' worth of trading activity, at typical volumes. In fact, it's possible some of today's call buyers -- especially those initiating positions at out-of-the-money strikes -- may be short sellers attempting to hedge their bets. For another, 80% of covering analysts consider the shares worthy of a tepid "hold" rating.

From a technical perspective, this skepticism seems justifiable. Despite Zillow Group Inc's (NASDAQ:Z) 4.1% rally this afternoon to trade at $90.52, the shares have plunged 45% since hitting an all-time high of $164.90 last July. What's more, today's gains are being contained by Z's descending 32-day moving average.
 

Unlock Weekend Profits with Chris Prybal's Favorite Strategy Up +487.5% in 2024

With the markets going left, right, and sideways, you need to have a plan now more than ever. 

Expert Trader Chris Prybal is no stranger to volatility, and has mastered finding big stock rallies while other traders aren't looking over the weekend. Rallies that produced gains like +207% on RTX calls, +236% on MARA calls, and +238% on NET calls.

A few simple moves on Sunday at 7pm could be the “Secret Sauce” your portfolio needs to not just stay afloat, but make unprecedented gains in this turbulent market.


Don’t sit on the sidelines, beat the market with Chris Prybal's strategy. Join him now!

 

 
 
 


 
 

Rainmaker Ads CGI