Kellogg Stock Pops on Spinoff Announcement

The security has broken through the 20-day moving average

Digital Content Manager
Jun 21, 2022 at 10:06 AM
facebook twitter linkedin


The shares of Kellogg Company (NYSE:K) were last seen up 4.8% to trade at $70.77, after the food manufacturer said it will spin off its North American cereal and plant-based businesses to form three independent companies. In recent years, Kellogg has focused on building a snacks portfolio, including its international cereals and noodles, as well as its frozen breakfast business, which together accounted for 80% of total sales in 2021.

The shares are today bouncing off of a floor at the $66 region, which supported the security since late May. The stock is also breaking through overhead pressure from its 20-day moving average, and added 10.6% over the past three months to now carry a 4.8% year-to-date lead.

The brokerage bunch is still hesitant towards Kellogg stock, leaving plenty of room for upgrades moving forward. In fact, 10 of the 12 analysts in question say "hold" or worse. Meanwhile, short interest is down 3.6% in the last two reporting periods, but still makes up 5.5% of the stock's available float, or more than one week's worth of pent-up buying power. 

The options pits are overwhelmingly bullish, on the other hand. Over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), K sports a 10-day call/put volume ratio of 10.95 that stands higher than 93% of readings from the last year. This means calls are getting picked up at a much quicker-than-usual clip.  

The stock's usually quiet options pits are seeing unusual volume today. So far, 657 calls and 516 puts have crossed the tape, which is double what's normally seen at this point. Most popular is the July 60 put, followed closely by the 72.50 call in the same monthly series. 

 

Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

 
Schaeffer's Daily Bulletin Offer
 


 


 
Special Offers from Schaeffer's Trading Partners