Macy's Stock Rises After Announcing New CFO

The stock is down over 63% this year

Digital Content Manager
Oct 14, 2020 at 9:33 AM
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    The shares of Macy's Inc (NYSE:M) are up 1.3% at $6.21 this morning, after the major retailer announced Adrian Mitchell, a managing director at Boston Consulting Group, will take over as chief financial officer in November. Mitchell has advised companies in big-box and specialty retail, restaurants, insurance and technology. He will assume his new role as Macy's prepares for a wildly different holiday shopping season, focused on online sales and bigger promotions, as shoppers opt to stay home throughout the coronavirus pandemic.

    On the charts, shares have traded in a tight range between $6 and $8 for the past several months. And while that is somewhat better off from the stock's all-time-low of $4.38 on April 1, the equity still has to more than double before it reaches this year's pre-pandemic high of $18.57 in January. Year-to-date, M is down 63.9%, so it's no surprise analysts are so pessimistic towards the security, with five of the 10 in coverage sporting a tepid "hold" rating, and the remaining five carrying a "sell" or worse.

    The options pits lean far more optimistic, on the other hand, with calls popular. This is per M's 10-day call/put volume ratio of 14.69 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), that sits higher than all readings from the past year. In simpler terms, this underscores an unusually high demand for long calls in the last two weeks. However, given that a whopping 40.4% of M's total available float is sold short, it's possible some could be using calls to hedge against any unexpected upside.

    Regardless of direction, traders looking to speculate on Macy's stock's next move should consider options. The security's Schaeffer's Volatility Index (SVI) of 89% sits in the 34th percentile of its annual range, suggesting short-term options are pricing in relatively low volatility expectations. In other words, the stock's near-term options are attractively priced at the moment.

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