Petroleo Brasileiro Petrobras SA (PBR) Traders Eye a Rebound

Petroleo Brasileiro Petrobras SA (ADR) (PBR) has appointed a new CEO

Digital Content Group
Feb 6, 2015 at 1:00 PM
facebook twitter linkedin


Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) is getting hammered this afternoon, down 9.4% to trade at $6.44 amid a major management shake-up. The stock has also found a place on the short-sale restricted list. However, that isn't stopping options traders from scooping up upside bets, as calls are crossing at 1.4 times the usual intraday rate.

Digging deeper, last-minute bulls are buying to open weekly 2/6 6.50-strike calls, while longer-term bettors are initiating long positions at the January 2017 5-strike call, per data from Trade-Alert. In so doing, the respective groups of traders are anticipating additional upside through tonight's close (when the weekly series expires) and January 2017 options expiration (when the LEAPS expire).

Today's call-buying activity marks a change of pace in PBR's options pits. Over the last 10 weeks, the stock has racked up a put/call volume ratio of 0.56 across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) -- a reading that ranks in the 94th percentile of its annual range.

As alluded to earlier, Petroleo Brasileiro Petrobras SA's (NYSE:PBR) intraday swoon -- which is more of the same for a stock that's lost 69% since hitting a two-year high of $20.94 in early September -- was sparked by the appointment of a new CEO. Specifically, Aldemir Bendine, who currently heads Banco do Brasil SA, was tapped for the post by Brazil President Dilma Rousseff.

Bernie's Best Stock Bets for Summer 2021

1608308875

 




 
Special Offers from Schaeffer's Trading Partners