Analyst: This Cybersecurity Stock Could Surge 68%

CBLK options are more popular than usual

by Karee Venema

Published on Jan 29, 2019 at 2:15 PM
Updated on Jun 24, 2020 at 10:16 AM

Raymond James upgraded Carbon Black Inc (NASDAQ:CBLK) to "strong buy" from "outperform," and maintained its $24 price target -- a 68% premium to last night's close at $14.30. The analyst in coverage waxed optimistic on the cybersecurity firm's growth potential, and said the stock is cheap at current levels.

In reaction, CBLK is trading up 7.7% at $15.40. The stock sold off sharply in the fourth quarter -- shedding 36.6%, and bottoming at a record low of $11.80 on Dec. 21. Since then, the shares have rebounded 30%, and are on track to close north of their 50-day moving average for the first time since Sept. 26.

cblk daily chart jan 29

Speculators are flooding into the stock's typically quiet options pits. Amid relatively low absolute volume, total options volume is running at six times the expected intraday pace, with 717 contracts on the tape so far. Almost all of the action has centered at the February 15 call, where new positions are being initiated.

Short sellers, meanwhile, have been hitting the bricks. Short interest plunged 20% in the most recent reporting period to 3.29 million shares. This represents 7.6% of CBLK's available float, or 6.6 times the average daily pace of trading.

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