BUY, SELL, HOLD (2)

Disney Stock Wobbles After Ticket Price Hike, Alibaba Deal

Options traders have been in bearish in recent weeks

Managing Editor
Feb 12, 2018 at 10:26 AM
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Walt Disney Co (NYSE:DIS) is making headlines today, after entertainment giant said it is raising prices for some of its theme park tickets. The company also announced a licensing deal with Alibaba (BABA), which will provide Disney content to BABA's Youku video streaming platform.  At last check, the stock had erased its earlier gains to trade down 0.1% at $102.95.

The stock has not had a great year on the charts, shedding 8.5% since a mid-January double top north of $113. But while the share have dropped below their 120-day moving average -- a trendline that served as a floor in the latter half of November -- they are holding above potential support at the round century mark.

In the options pits, sentiment has been bearish in recent weeks. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) show DIS' 10-day put/call volume ratio of 1.42 ranks in the 87th percentile of its annual range. This suggests puts have been bought over calls at a faster-than-usual clip during the past two weeks.

Echoing this skepticism, eight of the 15 analysts covering Disney stock maintain a "hold" recommendation. Plus, short interest shot 29.05% higher in the two most recent reporting periods to 24.36 million shares -- the most since November 2016.

 

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