Macy's, Inc. (M) Calls Hot on CEO Switch

Macy's, Inc. (NYSE:M) calls are outpacing puts, following the company's CEO announcement

Jun 23, 2016 at 3:12 PM
facebook twitter linkedin


Calls are outpacing puts by a 6-to-1 margin on retail stock Macy's, Inc. (NYSE:M), after the company announced Jeff Gennette would replace Terry Lundgren as CEO in 2017. At last check, call volume was hovering in the 83rd annual percentile, and the July 34 call has emerged as the most popular option overall. Data suggests some M options traders are opening long positions here, betting on the stock to rise above $34 before expiration at the close on Friday, July 15. 

Call buying in M's options pits is far from a fad. In fact, the stock's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 2.57 outstrips 94% of all comparable readings from the past year. Said differently, call buying has been unusually popular in recent months. 

This seemingly upbeat outlook isn't shared among analysts, though. Of the 14 brokerage firms that cover M stock, just one recommends buying it. 

This bearishness should not be surprising, given Macy's, Inc.'s (NYSE:M) long-term technical struggles. Over the past 12 months, the shares have lost more than half their value to trade at $33.32. And even though M stock is up 1.6% today, it appears to be running out of steam near its 10-week moving average, which it hasn't eclipsed on a closing basis since the first week in April. 

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical levels, and top economic stories straight to your inbox.

 

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 

 

300x250 - Banner 3 - v1