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Wal-Mart Takes Aim at Amazon; 2 Retail Stocks Reacting to Earnings

Lowe's and Express stocks are making big moves after earnings

Aug 23, 2017 at 10:14 AM
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U.S. stocks are lower this morning, after President Trump's remarks regarding NAFTA and reassurances that the Mexican and U.S. border wall will be built, even "if we have to close down our government." Among specific equities in focus are home improvement retailer Lowe's Companies, Inc. (NYSE:LOW), clothing concern Express, Inc. (NYSE:EXPR), and superstore giant Wal-Mart Stores Inc (NYSE:WMT). Here's a quick look at what's moving shares of LOW, EXPR, and WMT.

LOW Stock Lower After Earnings

Lowe's is making headlines this morning, after reporting disappointing second-quarter earnings and trimming its full-year forecast for operating margins. LOW stock is taking a hit, last seen trading down 5% at $71.98, in the vicinity of its July lows. Lowe's stock is now clinging to a 1.5% year-to-date gain.

Several LOW options traders could be kicking rocks today. The home improvement stock's Schaeffer's put/call open interest ratio (SOIR) of 0.23 ranks in just the 6th percentile of its annual range. This suggests short-term option players have rarely been more call-heavy during the past 12 months.

Express Rebounds After Second-Quarter Results

Express stock is higher, after the company reported better-than-expected second-quarter earnings and upped its full-year guidance. At last glance, EXPR was up more than 17% at $6.43 -- set to conquer its 50-day moving average for just the second time since May. On Monday, Express shares were trading at record lows.

Traders were bullishly positioned heading into the earnings report, sporting a 50-day call/put volume ratio of 4.85 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio registers in the 81st percentile of its annual range, indicating a healthier-than-usual appetite for EXPR calls over puts in the past 10 weeks. The stock also sports a SOIR of 0.18, which ranks in the 20th percentile of all other ratios in the past year.

Wal-Mart Eyes Amazon's E-Commerce Tactics

Wal-Mart is continuing its fight to the top of the e-commerce game, stepping back into Amazon's territory after partnering with Google to bring voice-shopping to consumer homes. Wal-Mart customers will soon be able to order products via Google Home -- a stab at Amazon's Alexa -- or by shopping Google Express.

The announcement has brought WMT stock up 0.5% to trade at $80.40, with the shares attempting to close last week's post-earnings bear gap.  Wal-Mart stock boasts a year-to-date gain of more than 16%, while sporting a Schaeffer's Volatility Scorecard (SVS) rating of 81, which means the retail giant has exceeded options traders' volatility expectations during the past year.
 
 

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