Stocks On the Move: Constellation Brands, Inc., L Brands Inc, and Otonomy Inc

STZ, LB, and OTIC are among the stocks on the move today

Jan 5, 2017 at 12:36 PM
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U.S. stocks are struggling, weighed down by poor holiday sales data. Among specific equities in focus today are alcohol issue Constellation Brands, Inc. (NYSE:STZ), retail stock L Brands Inc (NYSE:LB), and drugmaker Otonomy Inc (NASDAQ:OTIC). Here's a quick look at what's moving STZ, LB, and OTIC.

  • STZ is down 6.2% at $148.19, despite an earnings beat and upwardly revised guidance. Concerns about potential tax changes under the Trump administration are weighing on the stock, as the company imports most of its beer from Mexico. The drop has shaved Constellation Brands, Inc.'s year-over-year advance to 3.5%. Bullish traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) are likely disappointed. During the last two weeks, STZ has amassed a call/put volume ratio of 2.32 -- higher than 81% of readings from the past 12 months.
  • LB is getting drilled by disappointing December sales and lackluster fourth-quarter guidance, compounded by sector-wide retail headwinds. At last check, the stock is down 9.3% at $61.11. Analysts are piling on the bearish bandwagon, too, with no fewer than four price-target cuts issued in response to the fundamental flop. In fact, L Brands Inc isn't far from its annual low of $60, touched in May. Options traders have smartly been bracing for a plunge in the retail stock. At the ISE, CBOE, and PHLX, LB's 10-day put/call volume ratio has swelled to 4.07, just 9 percentage points from an annual peak.
  • By contrast, OTIC has soared over 12% to hover at $18.20, bolstered by positive top-line results from a late-stage trial on its ear infection drug, Otiprio. That said, the stock isn't in the clear, as it's testing resistance at its 320-day moving average -- a trendline that has repeatedly stymied the shares since September. Short sellers, meanwhile, may be in panic mode. One-tenth of Otonomy Inc's float is sold short, which would take three weeks to cover, at the stock's average trading rate.
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