The Canada-based pot producer announced better-than-expected fiscal third-quarter results
Canada-based weed stock Canopy Growth Corp (NASDAQ:CGC) is on fire today, up 16.3% to trade at $8.94, following the company's narrower-than-expected fiscal third-quarter losses per share and revenue beat. Plus, the pot producer slashed its fiscal spending plan, saving C$85 million ($67 million).
Options bulls are targeting the security after the fact, with call volume running at six times what's typically seen. So far, 52,000 calls across the tape, compared to 10,000 puts. The weekly 2/11 8.5-strike call is the most popular by far, with new positions being bought to open there.
This could point to an unwinding of pessimism in the options pits. CGC's 10-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits in the 98th percentile of its annual range, indicating a much stronger-than-usual preference for puts during this time.
Today's jump has CGC continuing its bounce off its late-January lows, which is home to the stock's Jan. 24 four-year low of $6.64. Year-over-year, the equity is still down 81.8%.
It's also worth noting that there is plenty of short-covering potential. Short interest makes up 18.1% of the stock's available float. In other words, it would take nearly six days to buy back these bearish bets, at Canopy Growth stock's average pace of trading.