Box Stock Continues to Slide Before Earnings

Box Inc (NYSE:BOX) is down 5.5% to trade at $24.97 at last check, as Snap (SNAP) drags the tech sector lower with its grim quarterly warning. These headwinds come just ahead of the cloud name's first-quarter earnings report, which is due out after the close tomorrow, May 25. Below, we will explore the equity's performance on the charts of late, as well as some of some of its post-earning activity in the past couple of years.

Digging deeper, Box stock is pacing for its third-straight daily loss, while carrying a 4.4% year-to-date deficit. The security has careened lower on the charts since hitting an April 20, record high of $33.04, while its 10-day moving average has emerged as a new layer of pressure. Should these losses hold, the shares will settle at their lowest level since February.

Box stock has finished four of eight post-earnings sessions higher in the past two years,  including a 10.3% jump in December. Options traders are pricing in an 12.6% swing for BOX after earnings this time around, which is much higher than the 3.9% move it averaged following its last eight reports, regardless of direction.  

The options pits have been leaning bullish on BOX, per the security's 50-day call/put volume ratio of 4.45 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than 90% readings from the past 12 months. This means there has been a healthier-than-usual appetite for long calls of late.

Today's options pits indicate a shift, however. So far, 1,746 puts have exchanged hands, which is triple the intraday average, and more than double the 839 calls traded. The most popular contract is the June 26 put, where new positions are currently being opened.

Shorts have been building their positions, too. Short interest rose 10.7% in the last two reporting periods, and the 9.69 million shares sold short account for 7% of the equity's available float, or roughly one week's worth of pent-up buying power.