Schaeffer's 43rd Anniversary Stock Picks in 2024

Facebook Stock Trades Higher on Restructuring, Blockchain News

The reshuffling will feature a new team dedicated to blockchain

Managing Editor
May 9, 2018 at 10:07 AM
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Facebook Inc (NASDAQ:FB) stock is up 0.5% to trade at $179.78 this morning, after the company announced an extensive restructuring of executive responsibilities, including a new team dedicated to blockchain and privacy concerns. The company will now be divided into three divisions called "Family of apps," "New platforms and infra," and "Central product services."

Facebook stock is trading just above its year-to-date breakeven level. Since falling to the $150 area in late March following the Cambridge Analytica scandal, FB has rallied, on pace for its fifth straight weekly win and tacking on nearly 20%, thanks mostly to a huge earnings reaction late last month. In fact, the shares are set for their highest close since the mid-March bear gap.

Analysts remain committed to the social media stock. Of the 29 brokerages covering FB, 28 rate it a "buy" or "strong buy," with not a single sell on the books. Furthermore, the security's average 12-month price target sits at $219.37, well above its current perch and deep into record-high territory.

In the option pits, however, traders have been more bearish than normal in recent weeks. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows the security with a 10-day put/call volume ratio of 0.78, ranking five percentage points from a 52-week high. While the low absolute ratio indicates more calls than puts bought to open, the high percentile suggests accelerated put buying over call buying lately. Regardless, the stock's Schaeffer's Volatility Index (SVI) of 22% is in the 23rd annual percentile, indicating short-term options are pricing in relatively low volatility expectations at the moment.

 

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