Toyota Cuts Current-Year Profit Forecast by 20%, Stock Sinks

TM breached a recent floor on the charts

Deputy Editor
May 11, 2022 at 10:45 AM
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The shares of Toyota Motor Corp (NYSE:TM) are down 2.8% at $161.77 this morning, following the car and truck company's warnings that its profits for the current fiscal year could fall over 20%, thanks to rising costs for raw materials. To buffer the impact, Toyota said it would consider alternative materials and other expense reduction tactics. Further, the firm reported a 33% drop in profits for its fiscal fourth quarter, which was impacted by the chip shortage and China's recent Covid-19 lockdowns. 

TM has shed more than 10% since the start of the year, though it still clung to a 9.3% year-over-year lead heading into today. However, it just breached a recent floor at the $165 level at the open, with overhead pressure guiding the stock lower since mid-February.

The security's options pits are consistently quiet, but volume is running at six times the intraday average, with 361 calls and 110 puts exchanged so far. The most popular by far is the June 190 call, followed distantly by the May 135-strike put, where positions are being sold to open.

This penchant for long calls is nothing new. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), TM sports a 50-day call/put volume ratio of 3.23, which sits higher than 79% of readings from the past year. In other words, there's been a healthier-than-usual appetite for these bullish bets of late. 

 




 
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