Boeing Stock Flying High on Reports of Production Resumption

Option players are betting big on BA stock

Deputy Editor
Apr 17, 2020 at 2:17 PM
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Amid the COVID-19 pandemic, it’s an understatement to say the airline sector is taking a massive hit. The order book of jet makers and their deliveries has been impacted immensely, with Boeing Co (NYSE:BA) suffering a reported 313 cancellations mixed between contract terminations and future cancellations. Despite this, the aerospace giant plans to resume production of all commercial airplanes at its Seattle-area facilities next week. In response, BA is up 11.8% last seen trading at $150.05.

On the charts, BA is chasing its 30-day moving average, a trendline that has been acting as stiff resistance and one the stock hasn’t toppled since February 21. Moreover, the security is still facing a 54% year-to-date deficit.

BA Chart April 17

Still, analysts are leaning toward the pessimistic side. Of the 15 in coverage, 11 call it a “hold” or worse. Meanwhile, the consensus 12-month price target of $163.56 is a slim 8.4% premium to current levels.

Options players are big on Boeing today. So far, 345,000 calls and 102,000 puts --double the intraday average -- have crossed the tape. That volume is pacing for the 100th percentile of its annual range. The two most popular are the April 160 and 155 call contracts, with new positions are being opened at both, indicating more bullish bets are being played last-minute as these positions are set to expire this evening.

 

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