Cinemark Stock Brushes Off Surprise Profit, Earnings Beat

The stock is more than 30% off its annual lows

Digital Content Manager
Feb 25, 2022 at 10:29 AM
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The shares of Cinemark Holdings, Inc. (NYSE:CNK) are down 0.6% at $17.65 this morning, despite the movie theater company sharing a fourth-quarter profit of $0.05 per share, surprising analysts which expected a loss of 13 cents per share. Cinemark's revenue of $666.7 also topped expectations, with the company noting its strong quarterly results came from a return to theaters as Covid-19 restrictions eased. 

The stock looks to have found its footing at the 60-day moving average, but still has to contend with its 200- and 320-day moving averages -- which have acted as a canopy to the shares since mid-November -- if it wants to rise back up the charts. CNK boasts an 8.6% year-to-date lead, and is up more than 30% off its Jan. 28 annual low of $13.37.  

Short sellers have been piling on, with short interest up 13.7% in the most recent reporting period. The 22.66 million shares sold short make up a hefty 21.2% of the stock's available float, and would take over seven days to buy back, at the stock's average daily pace of trading. 

Similar sentiment can be observed in the options pits. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), CNK sports a 10-day put/call volume ratio of 9.54, which stands in the 98th percentile of its annual range. This means long puts have rarely been more popular during the past year. 

Short-term options traders have also been much more put-biased than usual. This is per CNK's Schaeffer's put/call open interest ratio (SOIR) of 1.67, which sits higher than 97% of readings from the past year. 

Today's options activity is more call-centric, however. In the first half hour of trading, 1,946 calls have crossed the tape, which is triple the intraday average. The March 17.50 call is by far the most popular contract, followed by the 20 call in the same monthly series. 

 

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