AutoNation Stock Extends Uptrend on Stimulus Pledge

Put have been a popular pick among options traders

Assistant Editor
Apr 27, 2020 at 10:14 AM
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The shares of AutoNation, Inc. (NYSE:AN) are on the rise after the automotive retailer said it will return $77 million it had previously received from the U.S. Paycheck Protection Program (PPP). Following cost-cutting measures and a revision of the loan program's guidelines, AutoNation came to the conclusion of returning the forgivable loan. As a result, AN was last seen up 2.7%, to trade at $34.57.

On the charts, AN is looking to close above its 50-day moving average for the first time since late February. What's more, the equity has tacked on 23% so far this quarter, and is now eyeing a fourth straight daily gain. Covering analysts look to be leaning pessimistic, however, with eight out of nine rating it a “hold” or worse.

Meanwhile, in the options pits, AN sports a 10-day put/call volume ratio of 7.63 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio sits in the 94th percentile of its annual range, suggesting a healthier-than-usual appetite for long puts as of late.

Echoing this, the security's Schaeffer's put/call open interest ratio (SOIR) of 2.12 sits higher than all but 1% of other readings from the past year. In simpler terms, short-term option players have rarely been more put-biased in the past 12 months.

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