Options Red-Hot Ahead Of Abbott Earnings
Schaeffer's Investment Research | Oct 16, 2019 02:15AM ET
The shares of healthcare stock Abbott Laboratories (NYSE:ABT) are up 2.6% at $81.87 just ahead of tomorrow's third-quarter earnings -- due out before the open tomorrow, Oct. 16 -- after the board announced a share buyback plan of up to $3 billion. The company also announced a partnership with Tandem Diabetes Care (TNDM), which has the latter stock higher today, too.
What's more, the equity is set to take over its 20-day moving average for the first time in over a month. Since its late-July, record peak of $88.76, the stock has cooled gradually, touching a four-month low of $78.51 just last week. Since then, however, ABT has found support at its 200-day moving average -- a trendline that's had bullish implications for the equity in the past.
Options players have been extremely bullish ahead of earnings, with 5.74 calls bought for every put on the the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) during the last 10 days -- which sits higher than all other readings from the past year.
That being said, options are running hot today, with 8,778 calls and 4,037 puts across the tape so far -- three times what's typically see at this point. The two most popular positions are the October 81 put, where positions are possibly being sold to open, followed by the October 82 and 83.50 calls.
Abbott's post-earnings moves have been split during the last eight sessions, with the stock averaging a next-day swing of 2.5%, regardless of direction. This time around, the options pits are pricing in a slightly bigger move at 4.6%.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.