Call Buyers Respond to Tesla Motors, Inc. (TSLA) Spike

Tesla Motors Inc (TSLA) is popping on positive analyst attention

by Digital Content Group

Published on Feb 2, 2015 at 1:25 PM
Updated on Jun 24, 2020 at 10:16 AM

Tesla Motors Inc (NASDAQ:TSLA) puts have been in high demand in recent months -- which isn't surprising, considering the shares have underperformed the broader S&P 500 Index (SPX) by 14 percentage points over the last three months. Specifically, the stock's 50-day put/call volume ratio across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits at an annual high of 1.11.

Today, however, with TSLA up 3% at $209.65 -- thanks to a price-target hike to $385 at Global Equities Research -- call volume is accelerating. Specifically, the contracts are being exchanged at 1.3 times the average intraday clip, and short-term strikes are in demand, per the security's 30-day at-the-money implied volatility -- up 3.1% to 52.6%.

Digging deeper, buy-to-open activity is transpiring at TSLA's weekly 2/6 210- and 215-strike calls. In other words, these traders expect the stock will topple the respective strikes by this Friday's closing bell, when the weekly series expires. However, Tesla Motors Inc (NASDAQ:TSLA) hasn't closed a week atop either level since early January, and the shares are currently testing resistance at their descending 10-week moving average (at $211.05).


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