3 Trucking Stocks Getting Run Off the Road

Cummins Inc. (NYSE:CMI), Navistar International Corp (NYSE:NAV), and PACCAR Inc (NASDAQ:PCAR) are off sharply amid downbeat truck order data

by Alex Eppstein

Published on Dec 3, 2015 at 2:50 PM
Updated on Jun 24, 2020 at 10:16 AM

Vehicle machinery stocks have had it rough today, after North American heavy truck preliminary orders plunged 60% year-over-year to their lowest level since August 2010. Among the notable casualties are Cummins Inc. (NYSE:CMI), Navistar International Corp (NYSE:NAV), and PACCAR Inc (NASDAQ:PCAR).

CMI was down nearly 3.1% at last check, trading around $91.92, after earlier hitting a fresh three-year low of $91.80. This is just what option bears have been looking for. During the past 10 weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), traders have bought to open 1.56 CMI puts for every call. The corresponding put/call volume ratio sits just 2 percentage points from a 52-week high.

Shifting gears, NAV has plunged 6.6% to hover around $12.85, extending its monthly and year-to-date losses to 11% and 61.3%, respectively. Amid this swoon, short sellers have been gambling on extended technical troubles. Roughly one-quarter of the stock's float is sold short, and at NAV's typical trading levels, it would take 12 sessions for these bears to buy back their bets.

Last but not least, PCAR has stumbled to a 5.6% loss at $48.40, bringing its 2015 deficit to almost 29%. A recent crop of option bulls may not be happy with this development. During the past 10 days at the ISE, CBOE, and PHLX, traders have bought to open more than four calls for each put. The resultant call/put volume ratio of 4.32 outranks 88% of comparable readings from the prior year. From a contrarian perspective, an unwinding of these bullish bets could weigh on PCAR down the road.

A Schaeffer's 39th Anniversary Exclusive!

8 Top Stock Picks for 2020

Access your FREE insider report before it's too late!


  
 
 

Partnercenter