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Starbucks Shares Push Higher on Restructuring News

Short-term traders have rarely been more call-heavy toward SBUX this past year

Managing Editor
Sep 25, 2018 at 9:41 AM
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Shares of Starbucks Corporation (NASDAQ:SBUX) are edging higher in early trading, thanks to news the coffee chain's CEO Kevin Johnson sent a memo to employees revealing plans for a corporate restructuring. "We must increase the velocity of innovation that is relevant to our customers, inspires our partners, and is meaningful to our business" Johnson wrote. At last check, SBUX is up 0.8% at $57.14.

On the charts, Starbucks stock has had a volatile year. The shares in recent months have been pushing higher after their late-June lows near $47.50, now testing the site of their mid-June bear gap. In fact, SBUX has moved back into positive year-over-year territory, though it it's still looking up at its January high near $62.

Looking toward options, the equity's Schaeffer's put/call open interest ratio (SOIR) comes in at 0.72, which ranks in the bottom percentile of its annual range. This means that short-term options traders are unusually call-skewed at the moment.

Lastly, those who want to target the security may want to do so now with options. The stock has a Schaeffer's Volatility Index (SVI) of 18%, which ranks in just the 28th annual percentile. This reveals the security's short-term options are pricing in unusually low volatility expectations at the moment -- a boon to potential premium buyers.
 

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