Amazon Stock Edges Higher on New Whole Foods Grocery Service

AMZN options traders have been leaning towards the bulls' camp in recent weeks

Emma Duncan
Feb 8, 2018 at 10:04 AM
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E-commerce powerhouse Amazon.com, Inc. (NASDAQ:AMZN) will begin to deliver Whole Foods groceries to Amazon Prime Now members in select cities. The service is expected to expand across the U.S. later this year. In response, AMZN stock is up 1.1% at $1,433 in early trading.

Looking broader, Amazon stock has gained more than 74% over the past year, and most recently touched a fresh record high of $1,498 on Feb. 2, after reporting better-than-expected fourth-quarter earnings. Even amid the recent broad-market headwinds, the FAANG stock has gained 1.9% in the past week.

In the options pits, sentiment has been bullish in recent weeks. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows AMZN with a 10-day call/put volume ratio of 1.12, ranking in the 70th percentile of its annual range. This suggests calls have been bought over puts at a slightly faster-than-usual clip during the past two weeks.

Echoing this, Amazon stock's Schaeffer's put/call open interest ratio (SOIR) of 0.98 ranks in just the 12th percentile of comparable readings taken in the past year. This low reading suggests that short-term speculators have rarely been more call-skewed toward the stock during the past 12 months.

Unsurprisingly, the analyst outlook has remained overwhelmingly optimistic in recent weeks. Of the 37 brokerage firms following the stock, a healthy 33 carry "buy" or "strong buy" recommendations.

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