Goldman Sachs upgraded WW to "buy" from "neutral"
WW International Inc (NASDAQ:WW) stock is soaring today, after Goldman Sachs upgraded the WeightWatchers parent to "buy" from "neutral," with a price-target hike to $13 from $3.80.
The firm expects consumers to turn to the weight management company to help them navigate the "increasingly complex field of pharmaceutical solutions." Just last month, WW International entered the prescription weight loss business with its acquisition of Sequence, which offers users to access to appetite suppressing drugs such as Ozempic.
The shares of WW International are up 45.6% at $6.00 at last glance, their highest level since last month's surge that preceded a correction back into penny stock territory. Today's bull gap has WW breaking above pressure at the $4.50 level. Year-to-date, the equity is up 55.7%.
Of the seven analysts in coverage, two now carry a "buy" or better rating, while five still rate WW a "hold" or worse. Short interest has been building, however, and the 8.16 million shares sold short account for 15.4% of the stock's available float.
The security's typically quiet options pits are bursting with bullish activity amid the surge. So far, 28,000 calls have been exchanged, which is 30 times the typical call volume seen at this point. The January 2024 15-strike call is the most active contract, with new positions being opened there.
WW is sporting attractive premium at the moment, too, as per its Schaeffer's Volatility Index (SVI) of 84%, which sits in the low 12th percentile of its annual range. This means options traders are pricing in low volatility expectations at the moment.