BAC Inches Higher After Impressive Q1 Results

The security has already added over 30% in 2021

Deputy Editor
Apr 15, 2021 at 9:43 AM
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Bank of America Corp (NYSE:BAC) stepped into the earnings confessional this morning, becoming the latest bank name to chime in on a strong start to earnings season. Bank of America reported top and bottom-line beats for the first quarter, with profits of 86 cents per share on revenue of $22.9 billion. The company chalked this win up to big investment banking and trading results, as well as its decision to release $2.7 billion in reserves for loan losses. At last check, BAC is up 0.4% at $39.88.

On the charts, Bank of America stock notched a 13-year peak of $40.38 on Apr. 12. Today's positive price action has the security heading in the right direction to topple those highs, with support from the 20-day moving average. Year-to-date, the equity has already tacked on 31.6%. 

The options pits have been overwhelmingly bullish over the last two weeks. This is per the security's 10-day call/put volume ratio of 3.26 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than 83% of readings from the past year. This means calls are being picked up at a faster-than-usual clip. Echoing this, Bank of America stock's Schaeffer's put/call open interest ratio (SOIR) stands higher than just 7% of readings in its annual range, meaning short-term traders have rarely been more call-biased.  

Lastly, now could be a good opportunity to take advantage of BAC's next move with options. The stock's Schaeffer's Volatility Index (SVI) of 28% sits in the extremely low 3rd percentile of its annual range, indicating the equity sports attractively priced premiums at the moment. 

 

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