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Yahoo! Inc (YHOO) Shrugs Off AT&T Divorce

Yahoo! Inc (YHOO) continues to trek higher, despite AT&T Inc. (T) severing ties with the Internet mogul

May 5, 2016 at 3:09 PM
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Yahoo! Inc (NASDAQ:YHOO) is shaking off its divorce with AT&T Inc. (NYSE:T) this afternoon, with the embattled Internet stock up 2.7% at $36.98. This is a welcome development for shareholders and options traders alike -- with the latter group, in particular, placing bullish bets at an extreme rate in recent weeks.

Diving right in, YHOO's 10-day call/put volume ratio across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits at an annual high of 8.74. In other words, options traders have never picked up bullish bets over bearish at a faster clip in the past 12 months.

On top of that, short-term options traders are very call-focused toward YHOO. The stock's Schaeffer's put/call open interest ratio (SOIR) sits at 0.30, with calls more than tripling puts among options expiring in the next three months. What's more, this SOIR registers north of just 4% of all readings taken over the last year.

The brokerage crowd is firmly in YHOO's bullish camp, too. Two-thirds of analysts rate the Internet stock a "buy" or better, with not a single "sell" rating to be found. Plus, short interest has been steadily declining in recent reporting periods.

As Yahoo! Inc (NASDAQ:YHOO) sits on the brink of a potential sale, the shares have been plowing higher. Specifically, since bottoming at a two-year low of $26.15 in February, the stock has advanced over 41%. However, YHOO has had trouble breaking out from the $37-$38 zone in recent weeks, roughly corresponding with its 120-week moving average.

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