Kroger Stock Receives Bull Note Ahead Of Earnings

Options traders are piling up on bearish bets

Managing Editor
Mar 5, 2018 at 10:03 AM
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Kroger Co (NYSE:KR) stock is up 1.1% to trade at $27.66, after receiving a price-target hike from Deutsche Bank to $28 from $26. The upbeat analyst attention comes ahead of the company's fourth-quarter earnings report, due before the open on Thursday. 

After surging from an Oct. 2 three-year low of $19.70 to a Jan. 30 annual high of $31.45, Kroger stock pulled back along with the broader stock market. The shares have shed more than 5% in the past month, and are now trading below their formerly supportive 60-day moving average. Nevertheless, the equity has found a foothold near $27, which is a 38.2% Fibonacci retracement of its recent rally.

Options traders lately have taken a resoundingly bearish stance of late. This is based on the KR's 10-day put/call volume ratio of 2.94 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks 5 percentage points from a 52-week high. 

Furthermore, the equity's Schaeffer's put/call open interest ratio (SOIR) sits at 2.90. Not only does this indicate put open interest nearly triples call open interest among contracts expiring within three months, but the ratio ranks in the 98th percentile of its annual range, pointing to a much bigger-than-usual put bias among near-term traders.

 

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