TWLO Tapers Off From Record High Before Earnings

The stock hit a fresh record high just this last week

Assistant Editor
Feb 16, 2021 at 2:51 PM
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Twilio Inc (NYSE:TWLO) is down 3.6% at $419.56 at last check, falling further from its recent Feb. 11 record high of $441.19. Today's pullback has TWLO meeting support at its 10-day moving average, which the stock popped back over at the start of this month. This slump comes before Twilio's fourth-quarter earnings, due out after the close on Wednesday, February 17, in which analysts expect losses of eight cents per share. 

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Ahead of the event, the options pits are pricing in a post-earnings swing of 13.1%, regardless of direction, which is higher than the 9.8% move from the company's last eight quarters. Of these reports, only one of these post-earnings moves was positive -- which doesn't paint a very pretty picture for Twilio, historically. 

The options pits have been much more bearish than usual. This is per TWLO's 50-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than 94% of readings from the past year.

This is echoed when drilling into today's options activity, where 6,620 puts and 5,878 calls have crossed the tape so far. Seeing the most activity today are monthly February options, which expire at the end of this week. Specifically, the February 640 call and 370 put from the same series look to be favorites. 

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