Bike Recall Pushes Peloton Stock to Record Low

PTON is down more than 50% year-over-year

Digital Content Manager
Aug 23, 2023 at 10:26 AM
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Peloton Interactive Inc (NASDAQ:PTON) is down 19.6% to trade at $5.66 at last check, after the fitness equipment company reported wider-than-expected fiscal fourth-quarter losses, though revenue still beat estimates. Also weighing on shares is a bike recall that will likely delay the company's return to a positive cash flow.

The security earlier dropped to an all-time low of $5.05 -- just shy of penny stock territory. PTON had been struggling with a ceiling at the $10 region since mid-April, while its 20-day moving emerged as pressure earlier this month. Year-over-year, the shares are down more than 50%.

Nevertheless, the options pits remain overwhelmingly bullish. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 50-day call/put volume ratio of 2.56 ranks higher than all but 2% of readings from the past 12 months.

Drilling down to today's options activity, 35,000 calls and 32,000 puts have swapped hands so far, which is 16 times the intraday average amount. Most popular by a long shot is the weekly 8/25 5.50-strike put, where new positions are currently being bought to open. 

It's worth noting short sellers remain firmly in control, despite short interest falling 21.3% in the last two reporting periods. In fact, the 31.65 million shares sold short make up 9.9% of Peloton stock's available float.

 

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