Big Lots stock is trading at its highest level since September 2018
The shares of Big Lots, Inc. (NYSE:BIG) are trading at their highest level since September 2018, and have added more than 58% year-to-date. Considering this positive price action, now looks like the perfect time to buy calls on BIG.
Meanwhile, there’s plenty of bearish activity occurring in the options pits. This is per BIG’s 10-day put/call volume ratio of 1.72 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio ranks in the 92nd percentile of readings from the past 12 months, suggesting a healthier-than-usual appetite for puts of late.
Looking at analyst sentiment, of the nine in coverage, five rate the equity a tepid "hold," while one more recommends a "sell. " With just four "strong buys" in the books, there remains plenty of room for upgrades going forward.
Short interest looks to be rolling over, up more than 74% since the April 1 reporting period. This accounts for 22% of the stock's total available float, or four days' worth of pent-up buying power.
Digging deeper, a large number of BIG’s 42.50-strike puts could unwind and provide an additional layer of options-related support. Plus, the equity's Schaeffer's Volatility Index (SVI) of 58% stands higher than 13% of all other readings from the past 12 months, and the stock's Schaeffer's Volatility Scorecard (SVS) sits at 93, indicating Big Lots stock has tended to exceed options traders' volatility expectations during the past year.
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