Options Volume Explodes on Zumiez Stock After Earnings

Jefferies slashed ZUMZ's price target

Deputy Editor
Sep 10, 2021 at 9:57 AM
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The shares of Zumiez Inc. (NASDAQ:ZUMZ) are down 4% at $38 this morning, following the company's second-quarter earnings report. While the apparel retailer posted earnings that topped analysts' estimates, its revenue missed expectations. Zumiez also withheld its third-quarter and full-year guidance, amid volatile conditions and economic uncertainty. 

Jefferies chimed in, slashing its price target to $52 from $60. Heading into today, the 12-month consensus price target of $50.20 sat at a 26.8% premium to last night's close. Meanwhile, analysts were split,  with three saying "strong buy" and three saying "hold."

Short interest has been on the rise, up 14.7% in the last reporting period, and these bears are firmly in control. The 1.43 million shares sold short make up  6.5% of the stock's available float, and would take over six days to cover at the equity's average daily pace of trading. 

In the options pits, short-term traders have been more put-biased than usual. This is per ZUMZ's Schaeffer's put/call open interest ratio of 0.89, which stands higher than 71% of readings from the past 12 months. 

Today, the stock's  typically quiet options activity has exploded. So far, 2,179 calls and 1,626 puts have exchanged hands, which is a whopping 29 times the intraday average. The most popular is the September 45 call, followed by the 35 put in the same front-month series, with positions being opened at both. 

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