Marriott Stock Makes Moves After First Quarterly Loss in Nine Years

Calls are popular in the options pits amid relatively inexpensive premiums

Deputy Editor
Aug 10, 2020 at 10:27 AM
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The shares of Marriott International Inc (NASDAQ:MAR), are up 1.2% at $94.94 at last check, despite reporting wider-than-expected second-quarter losses, as well as revenue below estimates. Hit hard by the effects of the coronavirus, this is the company's first quarterly loss since 2011. Over the next couple quarters, Marriott plans to implement restructuring plans to cut costs. 

On the charts, MAR has been consolidating beneath the $95 region for nearly two months. Now, the stock is taking another run at its 140-day moving average, which rejected it in late-June, while sporting a year-to-date deficit of 37.8%. 

On the analyst front, four of the 17 in coverage call Marriott stock a "strong buy," while 12 linger at a "hold," and one a "strong sell." Meanwhile, the 12-month consensus price target of $96.70 is just a 2.5% premium to current levels. 

The options pits have been bullish during the past 10 weeks. MAR's 50-day call/put volume ratio of 1.41 at the Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) stands higher than 94% of all readings from the last year. This means long calls are being picked up at a much faster-than-usual rate.  

That said, options may be a good way to go when weighing in on the hotel stock's next move. Marriott's Schaeffer's Volatility Index (SVI) 55% stands higher than just 22% of all other readings in its annual range, implying that options players are pricing in relatively low volatility expectations at the moment. 

 

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