AutoZone Stock Drives Higher After Upbeat Results

Now looks like a good time to weigh in with options

Deputy Editor
Mar 1, 2022 at 10:41 AM
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AutoZone Inc (NYSE:AZO) reported fiscal second-quarter profits of $22.30 per share on revenue of $3.37 before the bell this morning, both of which were higher than Wall Street's estimates. Same-store sales increased 13.8% for the quarter as well. AZO is rising after the results, last seen up 1.7% to trade at $1,895.06. 

This positive price action has AZO extending its rebound from last week's low of $1,759.02, which was captured by long-term support at the 180-day moving average. Year-over-year, AZO is up 62.7%, though it is still sporting a small year-to-date deficit, as the stock hasn't yet managed to surpass its Dec. 29, record high of $2,108.71.

It's also worth noting that AutoZone stock could have been due for a short-term bounce. The equity's 14-day Relative Strength Index (RSI) of 33 sits near to "oversold" territory. 

As is typical after an earnings event, AZO is seeing an increase in options activity. So far, options volume is running at double what's typically seen at this point. The June 2,900 call is the most popular, followed by the weekly 3/4 2,000-strike call, with new positions being bought to open at the latter. 

What's more, the security's Schaeffer's Volatility Scorecard (SVS) sits at a high 97 out of 100. This indicates the equity exceeded option traders' volatility expectations during the past year -- a good thing for options buyers.

 

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