Put traders are targeting the $6 level for GPRO
GoPro, Inc. (NASDAQ:GPRO) is trading up 8.9% today at $5.40, thanks to the camera company's better-than-expected quarterly sales. While this puts the shares on pace for their best single-day rise since September, they're struggling to overcome the stubborn $5.50 area that's acted as resistance since late January. Plus, GPRO remains down more than 28% in 2018 -- and that putrid technical performance may be why options traders aren't buying today's rally.
Specifically, there's been huge activity at GPRO's October 6 put, where traders are opening positions. Those buying the puts are expecting the shares to continue trading below $6 through the coming months. More than 15,200 contracts have crossed at this strike alone today, compared to the equity's average daily put volume of just 3,443.
Unsurprisingly, GoPro options traders preferred puts coming into today. Total put open interest outweighed overall call open interest, and the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.27 shows this was also true for options expiring within three months. In fact, the front-month May 6 put is home to peak open interest by a long shot, and data from the major options exchanges show mostly buy-to-open activity there.
Analysts are also remaining bearish. There are 10 brokerage firms in coverage on the security, and not one of them say to buy it. Plus, the average 12-month price target of $5.78 shows this group is expecting almost no upside from the stock.