Analysts, Options Traders Bombard COUP After Earnings

COUP options are trading at 10 times the average intraday amount

Assistant Editor
Jun 8, 2021 at 10:13 AM
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Coupa Software Inc (NASDAQ:COUP) took a trip to the earnings confessional yesterday, reporting first-quarter earnings of 7 cents per share, which was well above Wall Street's forecasted losses of 19 cents. Revenue, meanwhile, was in line with estimates, jumping 40% year-over-year and the financial software company issued an upbeat forecast. Separately, a c-suite shakeup also grabbed the attention of investors, as Tony Tiscornia was promoted to chief financial officer, taking over for Todd Ford, who was promoted to president of finance and operations. COUP is brushing off the whirlwind of news, last seen down 7.2% to trade at $219.74, and analysts were quick to chime in.

At last check, no fewer than 10 cut their COUP price targets. Mizuho and Barclays set the lowest targets at $250, while Morgan Stanley dished out a less dramatic drop after cutting its target to $381 from $395. Despite the seemingly encouraging report, Morgan Stanley is disappointed with weaker base of renewal billings from a year ago. 

The shift in the analyst community today isn't much of a surprise when you consider heading into today 12 of 17 brokerages maintained a "buy" or better rating on COUP, and the average 12-month price target of $299.43 is a lofty 36.3% premium to current levels.

Options traders are also piling on the equity after earnings. In the first hour of trading, over 3,000 calls and nearly 2,000 puts have crossed the tape, total volume that is 10 times the amount typically seen at this point. Most popular is the June 245 call, followed by the weekly 6/11 231-strike put, with new positions opening at the former. 

Today's negative price actions has Coupa Software stock trading at its lowest level in a year. Since a Feb. 19 record high of $377.04, the shares have carved out a channel of lower highs. Year-to-date, COUP now sports a 35.3% deficit.

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