Vindicated Hain Celestial Group Inc (HAIN) Sees Stock Soar

An accounting audit cleared Hain Celestial Group Inc (HAIN) of wrongdoing

Nov 17, 2016 at 11:53 AM
facebook X logo linkedin

Hain Celestial Group Inc (NASDAQ:HAIN) is going gangbusters today, after an audit committee review found no evidence of intentional wrongdoing in the organic food marketer's financial reporting. Adding to the enthusiasm, Jefferies reiterated a "buy" rating and a $50 price target, explaining that Nielsen data indicates the company's sales growth deceleration is likely transitory.

At last check, HAIN stock is 9.6% higher at $39.27. While these gains are impressive -- representing the largest intraday percentage lead in four months -- the shares remain well below their August highs near $57, touched just before a major bearish gap, which was triggered by the aforementioned accounting issues.

Amid these fundamental and technical developments, HAIN options are flying off the shelves, trading at eight times the expected intraday rate. As usual, calls are outstripping puts. In fact, call options account for eight of the 10 most active Hain Celestial strikes.

In recent months, calls have been the options of choice, too. Specifically, the stock has racked up a 50-day call/put volume ratio of 7.32 across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). Not only does this ratio indicate calls have been bought to open at more than seven times the rate of puts, it also ranks 4 percentage points from an annual high. In other words, calls have rarely been more popular among option buyers in the last 12 months.

Reinforcing this call bias is HAIN's Schaeffer's put/call open interest ratio (SOIR) of 0.24. Based on this SOIR, calls quadruple puts when looking at open interest in the front three months' series. What's more, this ratio is lower than all but 11% of readings taken in the prior year.

Turning elsewhere, though, it's clear not everyone is sold on Hain Celestial Group Inc (NASDAQ:HAIN). Nine of 14 analysts rate the stock a "hold" or worse, while 9.5% of its total float is sold short -- which would take over seven sessions to cover, at the equity's average trading rate. In fact, it's possible some recent call purchases came at the hands of short sellers hedging against an unforeseen breakout -- like the one we're witnessing today.

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical levels, and top economic stories straight to your inbox.


Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI