Camping World Stock Surges After Doubling Dividends

The equity's usually quiet options pits are brimming with activity

Digital Content Manager
Aug 24, 2021 at 11:06 AM
facebook twitter linkedin


Recreational vehicle concern Camping World Holdings Inc (NYSE:CWH) is surging today, last seen up 4.4% to trade at $38.88, after the company said it would double its quarterly dividend to 50 cents per share from 25 cents per share on a quarterly basis, and to $2 on an annualized basis, which will be payable to applicable shareholders on Sept. 28.

The equity has bounced off the $36 level after cooling off from a rally to the $44 mark, which is comparatively lower than its May 5, all-time high of $49.19. The shares are now testing overhead pressure at the 50-day moving average, though, which briefly served as an area of support earlier this month. Year-to-date, Camping World stock boasts a 49.5% lead.

The brokerage bunch has been overwhelmingly bullish towards the equity. Of the 10  analysts in question, seven carry a "buy" or better rating, while only three say "hold." Plus, the 12-month consensus target price of $55.13 is a 41.5% premium to current levels.

The security looks ripe for a short squeeze, too. The 7.19 million shares sold short make up a whopping 17.1% of the Camping Worldwide stock's available float, or nearly seven days' worth of pent-up buying power.

A shift over in the options pits could fuel even more tailwinds for the shares. This is per CWH's 10-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) of 1.15, which stands higher than 95% of readings in its annual range. This means puts are getting picked up at a quicker-than-usual pace.

The equity's usually quiet options pits are brimming with activity today. So far, 3,963 calls and 3,128 puts have already crossed the tape, which is four times what is typically seen at this point. Most popular is the September 45 call, followed by the 40 call in the same series.

These options traders are in luck, as CWH premiums can be had for a bargain right now. This is per the stock's Schaeffer’s Volatility Index (SVI) of 51%, which stands higher than 10% of readings from the past 12 months.

Grab your FREE Eternal Contrarian report!


 




 
Special Offers from Schaeffer's Trading Partners