Hasbro, Inc. (HAS) Earnings Beat Begets a Breakout

Hasbro, Inc. (HAS) hit its earnings report out of the park

by Alex Eppstein

Published on Oct 17, 2016 at 11:36 AM

Hasbro, Inc. (NASDAQ:HAS) is having quite a day, fresh off a better-than-expected earnings report. Specifically, the toy stock has jumped 7.6% to trade at $81.98, marking its best intraday percentage gain in six months. Suffice it to say, bullish options bettors should be feeling good at the moment.

While HAS puts are running at 12 times the usual intraday clip, options buyers have actually been centering on calls lately. Specifically, at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), traders have bought to open 1.43 calls for every put over the last two weeks. Just two weeks ago, this call/put volume ratio was 0.50, with long puts doubling calls.

Though call buyers may be in good shape, the same cannot be said of short sellers. HAS sports a short-interest ratio of 5.0, meaning it would take one week for short sellers to buy back their bearish bets. Analysts may need to rethink things, too. After all, seven of nine consider the stock a lukewarm "hold," while the consensus 12-month price target of $87.50 stands at a relatively modest 6.7% premium to current levels.

Thanks to today's bullish gap, Hasbro, Inc. (NASDAQ:HAS) has broken out of its descending channel, and extended its year-to-date lead beyond 21%. The next hurdles the stock must cross are its pre-bull gap close from mid-April, as well as its 160-day moving average. This trendline has more or less contained the shares today, but as recently as early September, it served as support.

has daily october 17

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