Twitter, Inc. (TWTR) Bulls Bet On Eleventh-Hour Upside

Twitter Inc (TWTR) traders are buying last-minute calls

by Griffin Kruse

Published on Mar 13, 2015 at 2:19 PM
Updated on Apr 20, 2015 at 5:32 PM

Twitter Inc (NYSE:TWTR) has had a nice start to 2015, with the shares up over 30% year-to-date. After jumping as high as $47.72 on reports of a new TV experiment, TWTR has turned lower in the face of broad-market headwinds, down 0.7% to linger near $46.74. Nevertheless, bullish activity in the options pits is prominent, with some traders betting on last-minute upside for the equity.

In afternoon action, calls have nearly tripled puts. Today's most active contract is the weekly 3/13 47-strike call, which is seeing buy-to-open activity. By purchasing this call, traders expect the stock to push its way above the strike price by the close today, when the contract expires.

Today's appetite for bullish bets runs alongside the recent trend, as TWTR's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 2.62 sits just 8 percentage points away from an annual peak. Traders are paying historically bottom-of-the-barrel prices for their short-term bets on TWTR, as its Schaeffer's Volatility Index (SVI) of 36% sits in the 3rd percentile of its annual range.

Elsewhere, the brokerage bunch is divided on Twitter Inc (NYSE:TWTR), as 13 out of 25 covering analysts rate the stock a "strong buy," with the remaining 12 doling out "hold" or worse opinions. Meanwhile, short interest has declined by nearly 18% over the past reporting period.

Daily Chart of TWTR Since October 2014

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