SunPower Stock Dimmed By Stock Offering

SPWR options trading has picked up the pace today

Managing Editor
Nov 18, 2019 at 10:08 AM
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Just a week after SunPower Corporation (NASDAQ:SPWR) was shining amid news of a strategic spin-off, the stock is now down 4.1% to trade at $7.96, after the company launched a public offering of common stock valued at 22 million shares. In response, options traders have perked up this morning.

More specifically, in just the first hour of trading today, over 2,500 SPWR options have changed hands, four times the average intraday amount and volume pacing for the 95th percentile of its annual range. Leading the charge is the June 7 put, where it looks like new positions are being sold. There are also new positions being opened at the weekly 11/22 8.5-strike call. 

SunPower stock, despite its 62% year-to-date lead, is fresh off its eighth straight weekly loss. Even the breakouts amid the spin-off news were quickly rejected by the shares' descending 30-day moving average. Since its Aug. 1 three-year high of $16.04, SPWR is now down 50%.

Pessimists of all sorts are likely cheering this recent downtrend. Although short interest declined by 11% in the most recent reporting period, more than 28% of the security's total available float is sold short, or 5.6 times the average daily trading volume. Plus, all but one analyst in coverage rates SPWR a "hold" or worse.

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