Q2 STOCKS TO BUY

Fresh Highs for this Cloud Specialist after Upbeat Earnings Report

Options traders are piling on the software name today

Deputy Editor
Sep 11, 2020 at 10:04 AM
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Software name Oracle Corporation (NYSE:ORCL) is getting some positive attention today, following its fiscal first-quarter earnings report of 93 cents per share, which topped analysts estimates. Revenue also came in above analysts' forecasts, with results propped up by an increased focus on cloud-based products and services intended to help people work remotely. As a result, the cloud specialist is up 5.1% at $61.27, hitting a new record high of $61.86 out of the gate.

The upbeat report has sparked at least 13 price-target hikes, the highest being dished out by Cowen and Company to $70 from $60. These were long overdue; coming into today the stock's consensus 12-month price target of $60.63 sat at a slim 1.2% premium to last night's close. Meanwhile there's still room for upgrades, considering 15 of the 21 in coverage maintain tepid "hold" ratings. 

The options pits have seen a heavy call bias. Oracle stock's 50-day call/put volume ratio of 5.39 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits in the 96th percentile of its annual range, implying that these traders have had a bigger-than-usual appetite for long calls of late. 

In just the first hour of trading today, over 60,000 calls and 11,000 puts have crossed the tape. That volume is running at five times the intraday average, and pacing for the highest percentile of its annual range. The September 60 call is the most popular, while there are new positions being opened at the 63-strike in the same series.

 

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