Newell Brands stock has shed more than 16% year-over-year
Shares of consumer products company Newell Brands Inc (NYSE:NWL) have been sliding since an early August earnings report, and a downwardly revised full-year guidance early last month sent the equity to an annual low. NWL is now down more than 16% year-over-year, but sentiment surrounding the stock remains overly bullish.
Analysts, for example, are extremely optimistic. By the numbers, nine of 13 covering brokerage firms have "buy" or "strong buy" ratings on the shares. A round of downgrades could come through and lead to extended downside.
And options traders are abnormally call-skewed at the moment, evidenced by NWL's Schaeffer's put/call open interest ratio (SOIR) of 0.29, ranking just 4 percentage points from an annual low. With much of this call open interest residing at strikes just above the stock's current perch, short-term headwinds could be in store.
It's certainly a good time to target near-term options, based on the Schaeffer's Volatility Index (SVI) of 20%, which ranks below 87% of all similar marks from the past year -- hinting at low volatility expectations at the moment.
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