UPS is cutting back its deliveries for Amazon
United Parcel Service Inc (NYSE:UPS) -- which is on Schaeffer's Senior Quantitative Analyst Rocky White's list of the worst stocks to own in January -- is plummeting today, down 15.4% at $113.16 at last glance. The stock is brushing off a fourth-quarter earnings beat after its revenue missed estimates and a downbeat full-year forecast. UPS also announced an agreement with Amazon.com (AMZN) to cut back its deliveries, catching several analysts by surprise.
Today's bear gap has UPS falling to more than four-year lows and its largest single-day percentage drop in history. The equity is on the short sell restricted (SSR) list amid the volatility, and sports a 30% year-over-year deficit.
Over in the options pits, 52,000 calls and 38,000 puts have been exchanged so far today, representing 10 times UPS' average daily options volume. The soon-to-expire, weekly 1/31 110-strike put is the most popular, where new positions are being bought to open.
Over the last 10 weeks, however, calls have been much more popular than usual. This is per UPS' 50-day call/put volume ratio of 2.88 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks higher than 90% of readings from the past year.