Ruby Tuesday, Inc. (RT) Puts Pop After Earnings Disaster

Ruby Tuesday, Inc. (RT) put options are hot, as the stock sits on the short-sale restricted list, following last night's earnings report

Oct 7, 2016 at 12:01 PM
facebook twitter linkedin

Restaurant stock Ruby Tuesday, Inc. (NYSE:RT) released its fiscal first-quarter earnings last night, posting an adjusted loss of 11 cents per share. RT's net loss widened after closing roughly 100 locations, while same-store sales fell 2.7%. In addition, the company said it will no longer offer fiscal guidance in order to focus on longer-term goals. Although RT's option pits typically see a low absolute volume, puts are taking off on a relative basis, trading at 16 times their usual intraday rate and in the 99th percentile of their annual range.

Meanwhile, RT's stock volume is on track to hit a new annual high, even as it sits on the short-sale restricted (SSR) list due to a post-earnings plunge. Today's selloff is likely a cause for celebration among short sellers, with short interest on RT up more than 19% over the last two reporting periods, and now accounting for 5.4% of its float. At the stock's average daily volumes, it would take roughly one week to buy back these bearish positions.

Drilling down into the technicals, Ruby Tuesday, Inc. (NYSE:RT) is down 13.4% at $2.17, after being halted earlier. Year-over-year, RT -- like several other food-industry stocks -- has struggled, with the shares down 67% over that time frame. What's more, the shares have been ushered lower by their 20-day moving average for the past few months, and earlier touched a seven-year low of $2.08.

Find out where the Dow lands right after the closing bell. Sign up now for Schaeffer's Market Recap


Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners