Options Traders Bombard Plummeting GameStop Stock

Options volume is running at double the intraday average

Assistant Editor
Sep 9, 2021 at 10:35 AM
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GameStop Corporation (NYSE:GME) is taking a massive breather today, down 10.2% at $178.50 at last check, after the video game retailer's second-quarter losses were wider than Wall Street anticipated. Specifically, GameStop announced losses of 76 cents per share, compared to expected losses of 66 cents. The company's revenue, however, jumped 25%, topping forecasts, though an outlook for the upcoming quarters was withheld. 

The event has options traders coming out of the woodwork. So far, 57,000 calls and 31,000 puts have crossed the tape -- two times what is typically seen at this point. The weekly 9/10 200-strike call is the most popular, followed by the September 200 call,  with positions being sold to open at the former. 

The brokerage bunch was already bearish toward GameStop stock coming into today, with all five in coverage carrying a "hold" or worse rating. In addition, the 12-month consensus price target of $88.33 is a whopping 51.7% discount to its current perch. 

On the charts, GME now faces pressure from the 120-day moving average, with the equity set to close below here for the first time in over two weeks. The security is pacing for its fourth-straight daily drop, though it remains up over 864% year-to-date.

 

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