Option Bears Bombard Diving Joy Global Inc. (JOY)

Joy Global Inc. (JOY) is fresh off multi-year lows, following lackluster earnings and guidance

Sep 3, 2015 at 2:06 PM
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An earnings miss and downwardly revised full-year forecast has Joy Global Inc. (NYSE:JOY) on track to finish with its worst single-day loss in seven years. Specifically, shares of the mining equipment maker have plummeted 15.8% to trade at $18.63, and earlier panned a six-year low of $17.70. With the stock now short-sale restricted, options volume is off the charts.

Right now, puts are being exchanged at 12 times the usual intraday rate, and twice the pace of calls. The most active option is the April 2016 14-strike put, as long-term bettors may be angling for downside. However, plenty of eleventh-hour traders are placing their wagers, as well, with buy-to-open activity detected at the weekly 9/4 18- and 18.50-strike puts -- anticipating JOY will breach the strikes by tomorrow's close, when the series expires.

Like other stocks related to the flagging coal industry, JOY is no stranger to negativity. Even before today, option bears were on the prowl. During the last 50 days at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the security has amassed a put/call volume ratio of 1.19 -- in the 73rd annual percentile.

The negativity extends far beyond options land, too. Nearly 80% of analysts tracking Joy Global Inc. (NYSE:JOY) have doled out "hold" or worse recommendations. What's more, over one-fifth of the stock's float is sold short -- representing almost 9 times JOY's average daily trading volume.

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