Vroom Stock Sinking on J.P. Morgan Downgrade

The security is down 93% year-over-year

Digital Content Manager
Aug 15, 2022 at 9:27 AM
facebook twitter linkedin

Used car retailer and e-commerce concern Vroom Inc (NASDAQ:VRM) is struggling, after J.P. Morgan Securities downgraded the equity to "underweight" from "neutral." The analyst in question cited a broader economic slowdown, which is expected to weigh on the shares. At last check, VRM is down 4.3% at $2.03.

The brokerage bunch was already skeptical on Vroom stock coming into today, with eight of the 10 analysts in question carrying a tepid "hold" rating. And though short interest is down 11.2% in the last two reporting periods, the 28.50 million shares sold short make up 21.6% of the stock's available float.

The security is looking to add to its steep 93% year-over-year deficit today. The shares just hit a June 13, all-time low of $1.03, and failed to conquer the 140-day moving average last week after losing steam just south of the $3 level. 

An unwinding of optimism in the options pits could pressure VRM even lower. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock sports a 50-day call/put open interest ratio of 8.38, which ranks higher than 77% of readings from the past year. This means long calls have been getting picked up at a much faster-than-usual clip.


Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners