PRTY Curbs Earnings Miss with New COVID-19 Measures

The equity is up over 264% for the quarter

Digital Content Manager
Jun 12, 2020 at 11:14 AM
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The shares of Party City Holdco Inc (NYSE: PRTY) are up 17.61% at $1.67 this morning, one of the best stocks on the New York Stock Exchange (NYSE), even after the retail chain reported first-quarter losses of $0.28 per share on $414.04 million in revenue, steeper than Wall Street's estimated $0.19 cents per share on $445.17 million. However, the company also announced store openings and expanded initiatives to navigate COVID-19 impact, such as curbside pickup, same-day delivery, furloughs, reduced executive salaries, and a revised capital expenditure budget.

On the charts, PRTY has had a difficult time climbing out of its mid-March lows near the $0.26 mark. Even so, the equity had already been experiencing hardship before the coronavirus pandemic took a hit, when shares dropped significantly in November to $1.52 from $7.37 in late October. Nonetheless, the stock is now showing signs of recovery, breaking north of its 20-day moving average in mid-May but finding overhead pressure at the $2.50 mark this past week. For the quarter though, PRTY sports a 264% lead.

Analysts were hesitant toward PRTY coming into today, with four of five carrying a tepid "hold," and only one sporting a "buy" recommendation. Meanwhile, the 12-month consensus target price of $2 is an 11.11% premium to current levels. 

In the wake of its quarterly report, PRTY's options pits are alive today. In just the first hour of trading, over 4,000 options have changed hands, double the average intraday amount and volume in the 98th percentile of its annual range. Leading the charge is the June 200, followed closely by the 150-strike call from the same series.

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