EARN25

Software Stock Surging After Beat-and-Raise

Options volume is running at 13 times the intraday average

Deputy Editor
Dec 6, 2022 at 10:55 AM
facebook X logo linkedin


GitLab Inc (NASDAQ:GTLB) stock is enjoying a post-earnings surge today, up 9.4% at $41.92 at last glance. The company reported smaller-than-expected third-quarter losses of 10 cents per share after the close yesterday, as well as a revenue beat. Furthermore, the software name raised its 2023 revenue forecast. 

In response, RBC raised GTLB's price target to $60 from $55, citing "the durability of revenue growth and emerging leverage in the model," while Piper Sandler cut its price objective to $60 from $67, despite seeing consolidation tailwinds. Overall, analysts are bullish towards the stock, with 13 of the 14 in coverage carrying a "buy" or better rating, while the 12-month consensus price target of $68.25 sits at a 60.3% premium to current levels. 

On the charts, GTLB has been slowly rising from its Nov. 9 six-month lows, with an upward trendline connecting higher lows since then. However, the descending 40-day moving average is still pressure the shares. Year-to-date, the equity is down 50.7%. 

As is typical after earnings, GitLab stock is seeing an options surge. So far, 11,000 calls and 6,043 puts have been exchanged, which is 13 times the intraday average amount. The December 45 and 50 calls are the most active contracts, with positions opening at the latter. 

It's also worth noting that short interest represents 11.5% of the stock's available float. It would take over five days to buy back these bearish bets, at GTLB's average pace of trading. 

 

You Don’t Need 25 Alerts -- You Need ONE You Can Trust!

That’s the idea behind Trade of the Week, Schaeffer’s newest trade alert.

Every Monday morning before the opening bell, you’ll receive a single, expertly researched trade recommendation -- built from the same proprietary research we’ve been using for over four decades.

It’s not just a signal.

It’s a plan designed for traders who are tired of jumping from alert to alert without ever finding their edge.

No juggling alerts. No switching directions mid-week. Just one clear, expertly researched trade idea -- delivered before the market even opens.

👉 JOIN RIGHT NOW FOR JUST $1 TO GET THE NEXT TRADE!