Post-Earnings High Lures The Walt Disney Company (DIS) Traders

Walt Disney Co (DIS) hit a record high out of the gate

by Alex Eppstein

Published on May 5, 2015 at 10:43 AM

Walt Disney Co (NYSE:DIS) jumped to a record high of $113.30 out of the gate, following an impressive turn in the earnings confessional, and was last seen up 0.5% at $111.57. As a result, the blue chip's options are being exchanged at nearly five times the usual late-morning rate.

The weekly 5/8 series is popular among traders. Specifically, it appears the weekly 5/8 112-strike call and 110-strike put are seeing buy-to-open activity. The call buyers anticipate DIS will muscle back atop $112 by week's end -- when the series expires -- while the put traders think the shares will close Friday south of $110.

Longer term, it's been call buyers that have held a decisive advantage over their bearish counterparts. During the last 10 days at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), option players have bought to open 3.18 calls for every put -- a ratio that ranks in the 94th percentile of its annual range.

However, not everyone is bullish on Walt Disney Co (NYSE:DIS). Currently, 41.7 million shares are sold short, which would take over seven sessions to buy back, at the stock's typical trading volume. If DIS continues running to higher highs, a short-covering rally could ensue.

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