Option Traders Eat Up Wendy's Stock After Earnings

The fast food chain is trading at its highest level this year

Assistant Editor
May 12, 2021 at 10:16 AM
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Wendy's Co (NASDAQ:WEN) is moving higher this morning, last seen up 3.5% to trade at $23.59, after reporting first-quarter top- and bottom-line beats. In addition, the fast food chain announced its comparable-restaurant sales rose 13.5% in the U.S. In response, Wendy's raised its dividend by 11%, boosted its stock repurchase plan by $50 million, and increased its full-year guidance.

The resulting surge helped WEN lock in a new 2021 high, hitting $24.18 early in the session. The equity faced a ceiling at the $23.10 level for much of the year, but that area could start acting as a floor. Wendy's stock is now poised for its highest close since Oct. 27, and boasts a 12.4% year-over-year rise.

Wendy's typically quiet options pits are exploding today, with traders from both sides of the aisle chiming in. So far, 6,441 calls and 5,587 puts have exchanged hands, which is a staggering 68 times the intraday average. The most popular position is the May 24 call, followed by the 23 put in the same series. 

There's been an undeniable preference for puts coming into today. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), WEN sports a 10-day put/call volume ratio of 1.02, which stands higher than 86% of readings from the past year.

 

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