Oatly Stock Plummets as High Inflation Attracts Downgrade

OTLY is already down more than 62% year-to-date

Digital Content Manager
Sep 13, 2022 at 10:08 AM
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The shares of Oatly Group (NASDAQ:OTLY) are sinking this morning, last seen down 8.9% at $3.01, after Credit Suisse downgraded the plant-based milk manufacturer to "neutral" from "outperform," and slashed its price target to $3.43 from $6. The analyst in question noted "more acute" inflation in Europe may impact demand, and expects consumers to turn to private-label alternatives.

Coming into today, analysts were bullish towards Oatly stock, with eight of the 12 firms in question calling it a "buy" or better, while the remaining four said "hold." Plus, the 12-month consensus target price of $5.34 is a whopping 76.2% premium to current levels.

Though short sellers have been hitting the exits lately, with short interest down 7.6% over the last reporting period, they still have the upper hand. The 21.79 million shares sold short make up 7% of the equity's available float, or over one week's worth of pent-up buying power.

The security earlier this month breached a long-term floor at the $3.20 level, and are back below here today after briefly attempting to reconquer it. Meanwhile, the $4.30 level has rejected multiple of Oatly stock's rallies since April, and shares now carry a 62.3% year-to-date deficit. 

The options pits have been firmly optimistic, however. This is per OTLY's 50-day call/put volume ratio of 5.28 over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than 75% of readings from the past year. This means long calls have been getting picked up at a faster-than-usual clip.


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