Q2 STOCKS TO BUY

Red-Hot GoPro Stock Attracts Fresh Batch of Call Buyers

GoPro shares have been moving higher since early August

Sep 11, 2017 at 1:44 PM
facebook X logo linkedin


Shares of GoPro Inc (NASDAQ:GPRO) have been tearing up the charts since early August -- gapping higher last week on the tech name's strong guidance -- with today's price action just more of the same. At last check, GPRO stock was 8% higher at $11.08, after Citigroup raised its price target to $10.50 from $9.50. As the security takes aim at its highest close on 2017, options traders are piling on, with calls and puts crossing at two times what's typically seen at this point in the day.

By the numbers, 10,617 calls and 5,904 puts have traded so far, with front-month September strikes accounting for seven of GPRO's 10 most active options. In the lead is the September 11 call. It looks as if some of the activity could be of the buy-to-open kind, in which case speculators are betting on GoPro stock extending its recent rally through expiration at this Friday's close.

This penchant for long calls is nothing new for GoPro options traders, though. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 10-day call/put volume ratio of 2.14 ranks in the 68th annual percentile -- meaning calls have been bought to open over puts at a faster-than-usual clip.

However, there could be an ulterior motive to this accelerated call buying. Considering how heavily shorted GoPro is -- more than one-quarter of its float is dedicated to these bearish bets -- short sellers could be initiating options hedges against any additional upside risk. 

Whatever the reason, now is a prime time for traders to buy premium on short-term GoPro options. While its 30-day at-the-money implied volatility of 47.7% ranks in the 13th annual percentile, its Schaeffer's Volatility Index (SVI) of 46% ranks lower than 93% of all comparable readings taken in the past year. These two volatility indicators suggest relatively muted expectations for GPRO.

 
 

Which of These SUB-$5 Stocks Could 26x From Here? (AD)

He called a rare 11x on Tesla…

Then he called a 26x on Workhorse…

Then an even rarer 35x on Nio Inc…

Now Tim Bohen says these 5 tiny “America First” stocks are next up in 2025.

They’re trading for less than $5 right now.

But thanks to Elon & Trump’s new alliance…

They could be off to the races in Trump’s first 100 days.

And right now for a limited time…

You can get the names & tickers for just $1 here. (AD)

GRAND SLAM COUNTDOWN

 
 

Featured Articles from Trusted Partners:

🚀 One Stock Pick Could Change Everything in 2025
What if one stock pick could define your success next year? Get 10 expert-vetted stocks set for 2025—plus 5 bonus picks to watch now. Get the Report →

🆕 New Options Need New Trading Strategies
Zero-DTE options are the newest (and hottest) options to trade.  Professional traders have rushed into the market and are making a mint.  Don’t get left behind - learn all about these options, how to trade them, market setups to profit from, plus much more. Download now →

👀 Revealed: 3 Defensive Stocks for Your Portfolio
Worried about the market? This free report reveals 3 under-the-radar defensive stocks for uncertain times in any kind of economy.

 

 
 

FREE Report Download

 

Follow us on X, Follow us on Twitter