JD.com Stock Nabs Record High As E-Tailer Eyes U.S. Soil

JD is hoping to gain ground on rivals Alibaba and Amazon

by Patrick Martin

Published on Jan 26, 2018 at 10:45 AM

JD.com Inc (NASDAQ:JD) is buzzing this morning, after Bloomberg reported the Chinese e-tailer was preparing for its long-awaited foray onto U.S. soil later this year. The company is hoping to establish itself on the West Coast, and start online sales by the second half of 2018. JD.com is hoping to gain ground on Chinese rival Alibaba (BABA) and American e-commerce monster Amazon.com (AMZN). Against this backdrop, JD stock is flirting with all-time highs.

In response to the buzz, KeyBanc chimed in with a price-target hike to $56 from $51 -- deeper into uncharted territory. At last check, JD stock up 3.5% to trade at $49.05, and earlier today touched a record high of $49.44. The shares have tacked on 73% year-over-year, and today is looking to take out resistance in the $48 region, which stifled JD's ascent in mid-2017. 

In the options pits, the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.81 indicates that calls outnumber puts among options expiring in three months. However, the ratio ranks in the 90th percentile of its annual range, pointing to a much bigger-than-usual put bias among near-term traders.

Echoing that, the stock's 10-day put/call volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) is in the 91st percentile of its annual range, indicating a much healthier-than-usual appetite for long puts over calls on JD during the past two weeks. An unwinding of skepticism in the options pits could add fuel to JD's fire.

What's more, JD had consistently rewarded premium buyers over the past year, per the security's Schaeffer's Volatility Scorecard (SVS) of 95. In simple terms, the shares have tended to make bigger-than-anticipated moves in the previous 12 months, relative to what the options market had priced in.


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