Options Players, Analysts Jump on Surging JD Stock

The e-commerce giant touched a two-year high today

Digital Content Manager
Apr 15, 2020 at 3:35 PM
facebook X logo linkedin


China-based e-commerce giant JD.Com Inc (NASDAQ:JD) is set for its highest close in over two years this afternoon, up 2.7% at $45.05, after reaching a strategic agreement with artificial intelligence (AI) specialist Blue Yonder, Inc. The two parties plan on working towards providing supply chain transformation solutions for retailers in China. 

In response, Morgan Stanley upgraded JD to "overweight" and hiked its price target to $51 fro $39. The analyst said JD is well positioned to weather the economic headwinds the broader market has been facing, due to its abundant cash position and sustainable margin improvement. This sentiment echoes the bullish stance Wall Street has taken, with nine covering analysts calling JD a "strong buy" coming into today, compared to five "hold" ratings. Plus, the consensus 12-month price target of $49.07 is a 9.3% premium to current levels, and represents a region not seen by the stock since 2018. 

Despite the recent positive price action JD has been seeing, the options pits have taken a different stance. While the equity's 10-day put/call volume of 0.46 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), indicates that calls are still outnumbering puts on an overall basis, the ratio sits higher than 80% of all other readings from the past year. This suggests a bigger-than-usual appetite for long puts of late. 

Looking at today's options activity, 43,000 calls and 23,000 puts have crossed the tape so far -- double what's typically seen at this point. The most popular position is the April 45 call. The April 44.50 put is also seeing some action, with positions being bought to open here. 

Considering recent market volatility, JD's options are still relatively cheap right now. The security's Schaeffer's Volatility Index (SVI) of 48% is in the 35th percentile of its annual range. In other words, options players are pricing in relatively low volatility expectations right now. 

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI