Schaeffer's Top Stock Picks for '25

3 Stocks Plunging After Earnings, Options Traders Respond

LYFT, VRT, and Z are sharply lower today

Deputy Editor
Feb 12, 2025 at 1:18 PM
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Earnings season can be a double-edged sword. While some stocks are rallying today on strong results, we're looking at three -- Lyft Inc (NASDAQ:LYFT), Vertiv Holdings Co (NYSE:VRT), and Zillow Group Inc Class C (NASDAQ:Z) -- that are sinking after earnings.

Lyft Offers Weak Booking Guidance

Lyft stock was last seen 3.1% lower at $13.94, after fourth-quarter gross bookings of $4.28 billion missed the $4.32 billion estimate. The company’s first-quarter guidance of $4.05-$4.20 billion also fell short of analysts' $4.24 billion forecast, raising concerns about growth amid increasing competition. Since the start of 2025, LYFT is up 8.3%.

Lyft’s options pits are buzzing with activity, with 141,000 calls and 85,000 puts traded -- six times the intraday average. The weekly 2/14 13.5-strike call is seeing the most interest, with new positions opening there.

Vertiv's Strong Q4 Overshadowed by Gloomy Guidance

Vertiv stock was 7.8% lower at $113.63 at last glance, moving below its year-to-date breakeven mark despite beating fourth-quarter expectations. The company expects first-quarter adjusted earnings per share (EPS) between $0.57 and $0.63, below the $0.63 analyst estimate. Its full-year EPS forecast between $3.50 and $3.60 also disappointed, with the midpoint below expectations.

VRT is also drawing heavy options action post-earnings, with 48,000 calls and 35,000 puts exchanged, or double its usual volume. The March 90 put is the most active contract, where traders are selling to open new positions.

Zillow's Weak Q1 Guidance Offsets Revenue Beat

Last seen 10.3% lower at $77.42, Zillow stock is falling after issuing disappointing first-quarter guidance, despite a Q4 revenue beat. The company expects first-quarter revenue between $575 and $590 million, below the $599.8 million analyst estimate, raising concerns about future growth in a sluggish housing market. Still, Z boasts a 4.6% year-to-date lead.

Z's typically quiet options market is seeing an uptick, with 14,000 calls and 13,000 puts traded -- 5 times the intraday average. The March 95 call is attracting the most attention.

 
 

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