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<p>Health and fitness device maker <strong>Fitbit Inc (NYSE:FIT)</strong> is set to report its fourth-quarter earnings after the close on Monday. FIT stock has had a rough go on the charts over the past couple of months, struggling since an <a href="https://www.schaeffersresearch.com/content/news/2017/12/15/analyst-time-to-sell-fitbit-stock"><strong>analyst-induced bear gap</strong></a> in mid-December. FIT has shed 13% year-to-date, and touched a record low of $4.90 earlier this month. At last check, the stock was up 1% to trade at $5.27.</p> <p>Diving into its earnings history, <strong><a href="https://www.schaeffersresearch.com/content/news/2018/01/31/analyst-fitbit-earnings-goals-within-reach">Fitbit stock</a></strong> carries about a 50% success rate, ending higher the day after earnings in four of the past eight quarters. Overall, the shares have averaged a post-earnings move of 15.2% in either direction in the session after the company reports, looking back eight quarters. For this particular quarterly report, the options market is pricing in a larger-than-usual 17.9% move for Tuesday's trading, going by implied volatility (IV) data.</p> <p>However, it's worth noting that FIT sports a Schaeffer's Volatility Scorecard (SVS) of just 12 out of 100. This indicates the shares have fallen short of options' traders volatility expectations during the past year.</p> <p>In the options pits, traders have been upping the bearish ante ahead of earnings, with data from International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) showing FIT with a 10-day put/call volume ratio of 0.84, ranking in the 95th percentile of its annual range. This indicates puts have been purchased over calls at a faster-than-usual clip over the past two weeks.</p> <p>Echoing that, Fitbit stock's short interest rose 21.7% over the past two reporting periods, and now represents nearly 20% of the stock's total available float. </p>
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<p><strong><a href="https://www.schaeffersresearch.com/content/ezines/2018/02/23/stocks-higher-after-fed-policy-report">U.S. stocks</a></strong> have steadily climbed today, as the Dow heads for another triple-digit victory. Among other names making noise, gun stock&nbsp;<strong>American Outdoor Brands Corp (NASDAQ:AOBC)&nbsp;</strong>and biotech stock&nbsp;<strong>Anika Therapeutics&nbsp;(NASDAQ:ANIK)&nbsp;</strong>are lower, while Chinese mobile app concern&nbsp;<strong>Momo Inc (NASDAQ:MOMO)</strong>&nbsp;is soaring. Here's a closer look at what shares of AOBC, ANIK, and MOMO are reacting to today.</p> <h2>Gun Control Debates Dig Into AOBC Stock</h2> <p>American Outdoor Brands stock, formerly known as Smith &amp; Wesson, is down 1.4% to trade at $9.98 -- and earlier touched a three-year low of $9.43 -- after <a target="_blank" href="http://money.cnn.com/2018/02/22/news/companies/blackrock-gun-questions/index.html"><strong>asset manager BlackRock</strong></a> weighed in on gun stocks following the Florida school shooting last week. BlackRock, a major investor in AOBC, said it will meet with gun makers and distributors to "understand their response" amid the divisive gun control debate that has erupted.</p> <p><a href="https://www.schaeffersresearch.com/content/news/2017/12/08/2-firearm-stocks-fall-on-grim-forecast"><strong>AOBC stock</strong></a> has now shed 26.6% in 2018, and is on track for its ninth consecutive losing month. Any breakout attempts during this span have been contained by the shares' descending 40-day and 80-day moving averages.</p> <p>Short sellers have been piling on amid the stock's steady downturn. Short interest increased by 24% since its mid-September low, and represents roughly 14% of AOBC's total available float.&nbsp;</p> <h2><span style="font-size: 18px;">Downgrade Pummels ANIK Stock</span></h2> <p>Shares of Anika Therapeutics are down 9.9% to trade at $51.98 -- on track for their worst one-day loss since December 2015 -- after Barrington Research downgraded the biotech name to "market perform" from "market outperform." The analyst in coverage sees a cap on price appreciation during the next few quarters. In response, ANIK shares gapped below their 160-day moving average, which caught the stock's pullback in late December.&nbsp;</p> <p> Most analysts remain in the stock's corner, as three out of four brokerage firms rate it a "strong buy." Furthermore, ANIK's average 12-month price target of $67 sits 30% higher than the stock's current perch. This indicates there is ample room for more downgrades and/or price-target cuts on the struggling biotech name.</p> <h2>Dating App Purchase Boosts MOMO Stock</h2> <p>Shares of Momo are up 14.2% to trade at $34.86, and on track for their best one-day gain since August 2016, after the company announced the acquisition of dating app <a target="_blank" href="https://techcrunch.com/2018/02/23/momo-buys-tantan-chinas-tinder-for-600m-as-chinese-social-networks-consolidate/"><strong>Tantan</strong></a>&nbsp;in cash-and-stock deal. MOMO stock is now set to close above its 200-day moving average for the first time since mid-September. The equity has tacked on 55% since falling to an annual low of $22.49 on Dec. 1, and is on pace to post its second straight weekly gain of more than 12%.&nbsp;</p> <p>In the options pits, calls have become more popular recently. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), MOMO's 10-day call/put volume ratio of 6.57 ranks in the 92nd annual percentile.</p>
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<p>The holiday-shortened trading week saw mixed price action on Wall Street, with a post-earnings slump for big-cap retailer <strong><a href="https://www.schaeffersresearch.com/content/ezines/2018/02/20/dow-futures-drop-on-walmart-earnings-miss">Walmart (WMT)</a></strong> pressuring the Dow and S&amp;P 500 Index (SPX) toward a third weekly loss out of four -- and putting the indexes comfortably on track to snap their 10-month winning streaks. And while the Nasdaq Composite (IXIC) appears ready to end the week higher as a <strong><a href="https://www.schaeffersresearch.com/content/ezines/2018/02/23/stocks-higher-after-fed-policy-report">Friday surge</a></strong> has the index on track to break its four-day <strong><a href="https://www.schaeffersresearch.com/content/ezines/2018/02/22/dow-adds-165-points-nasdaq-suffers-4th-straight-loss">losing streak</a></strong>, it's also headed for its first monthly loss since June.</p> <h2>VIX On Track for Best Month Since 2015</h2> <p>Conversely, the CBOE Volatility Index (VIX) is holding above <strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/20/s-p-just-rallied-right-into-resistance">key technical support</a></strong>, and pacing for its biggest monthly gain since August 2015 -- a breakout echoed in the iPath S&amp;P 500 VIX Short-Term Futures ETN (<strong><a href="https://www.schaeffersresearch.com/content/bgs/2018/02/19/anatomy-of-a-vxx-breakout">VXX</a></strong>). And while the market's "fear gauge" remains well off the elevated 50.30 mark it hit earlier this month, we couldn't help but notice this pair of <strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/22/2-vix-extremes-not-seen-since-2016">VIX extremes</a></strong> that recently sounded for the first time since 2016, while this <strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/21/this-volatility-signal-has-marked-key-s-p-turning-points">volatility signal</a></strong> points to short-term trouble for stocks.</p> <h2>Walmart Earnings Bring Retail Into Focus</h2> <p>In addition to dragging the Dow and SPX lower on the week, Walmart earnings -- in addition to big <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/20/albertsons-buyout-buzz-shocks-rite-aid-shorts">Rite Aid buyout</a></strong> buzz -- brought retail stocks into focus ahead of a&nbsp;<strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/22/why-its-time-to-jump-on-this-retail-etf">historically bullish period</a></strong> for the sector. In fact, previous WMT pullbacks have been a <strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/21/history-says-buy-the-walmart-dip">buy signal</a></strong> for the blue-chip stock in the past, while it might be time to join <strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/22/dont-miss-this-gap-stock-buy-signal">Gap (GPS)</a></strong> on its next leg north. </p> <p>Elsewhere, D.A. Davidson set lofty expectations for <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/20/bull-notes-lift-wayfair-etsy-stocks-before-earnings">Etsy (ETSY)</a></strong> ahead of next week's earnings report, and Advance Auto Parts (AAP) gapped higher after earnings -- catching <strong><a href="https://www.schaeffersresearch.com/content/options/2018/02/20/options-traders-eye-another-huge-earnings-move-from-advance-auto-parts-stock">bearish options traders off guard</a></strong>. IMAX (IMAX) shares also jumped thanks to a strong debut for "<strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/20/2-movie-stocks-soaring-today">Black Panther</a></strong>," though Tile Shop (TTS) stock spiraled to a <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/21/apple-stock-pops-on-battery-buzz-one-retail-stock-plummets-26-percent">record low</a></strong> after earnings. </p> <h2>M&amp;A Buzz Boosts Chip Stocks</h2> <p>Chip stocks, meanwhile, were one of the main catalysts for tech sector tailwinds -- sparked by Qualcomm's (QCOM) boosted <strong><a href="https://www.schaeffersresearch.com/content/ezines/2018/02/20/dow-s-p-win-streaks-snapped-gold-slides">buyout bid for NXP Semiconductors</a></strong> (NXPI), while Broadcom (AVGO) subsequently lowered its <strong><a href="https://www.schaeffersresearch.com/content/ezines/2018/02/21/stock-futures-cautiously-higher-as-markets-brace-for-fed-minutes">bid for QCOM</a></strong>. Plus, Bernstein said to <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/20/high-profile-partnership-sends-voyager-therapeutics-stock-to-top-of-nasdaq">buy Analog Devices</a></strong> (ADI) on its attractive valuation, and software name Zendesk (ZEN) sent up a signal that's had <strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/21/scoop-this-software-stock-up-now"><strong>bullish implications</strong></a></strong> in the past.</p> <p>MKM Partners, meanwhile, said this <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/21/mkm-partners-this-faang-stock-is-the-best-growth-story">FAANG stock</a></strong> had the " best growth story," and Craig-Hallum said to <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/22/analyst-sell-this-facebook-supplier">"sell" this Facebook supplier</a></strong>. And while Pandora Media (P) <strong><a href="https://www.schaeffersresearch.com/content/options/2018/02/20/options-bulls-blast-pandora-stock-ahead-of-earnings">options bulls</a></strong> cheered the stock's <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/22/pandora-stock-rallies-on-strong-subscription-revenue-growth">initial reaction to earnings</a></strong>, the shares swung lower by the close. Fellow streaming name <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/22/analysts-react-as-roku-stock-sinks-after-earnings">Roku (ROKU)</a></strong> also plunged after earnings, but analysts weren't too concerned.</p> <h2>Analysts Chime In On Bank Stocks</h2> <p>Financial stocks also got their fair share of attention this week. While Instinet said it's more <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/21/analyst-buy-discover-stock-over-capital-one">bullish on Discover Financial</a></strong> (DFS) than Capital One (COF), Berenberg listed these three big-cap bank stocks as its <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/23/3-bank-stocks-blasted-by-berenberg">preferred shorts</a></strong>. Oil stocks were on the radar, too, with <strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/21/chesapeake-energy-options-traders-bet-on-a-rare-earnings-boon">options traders</a></strong> nailing a rare Chesapeake Energy (CHK) <strong><a href="https://www.schaeffersresearch.com/content/ezines/2018/02/22/stock-futures-higher-despite-interest-rate-concerns">post-earnings pop</a></strong> -- and lifting its fellow <strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/22/cabot-oil-gas-options-price-in-bigger-than-usual-post-earnings-swing">energy shares</a></strong> higher.</p> <h2>Fed, Retail Earnings On Tap Next Week</h2> Looking ahead, Wall Street will be keeping a close eye on the Fed next week, after this week's <strong><a href="https://www.schaeffersresearch.com/content/ezines/2018/02/22/dow-up-triple-digits-as-rate-hike-worries-ease">rate-hike speculation</a></strong> -- with new Fed Chair <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/22/mr-powell-goes-to-washington-drug-retail-earnings-on-deck">Jerome Powell</a></strong> giving his inaugural testimony to Congress. Retailers will continue to be in the limelight, too, with Macy's (M) and J.C. Penney (JCP) among the many names set to report earnings. And for those looking to gain exposure outside of the U.S. stock market, consider <strong><a href="https://www.schaeffersresearch.com/content/analysis/2018/02/22/4-foreign-etfs-to-buy-this-week">buying these foreign ETFs</a></strong> right now, considering they all historically outperform over the next several months.
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<p><strong>ImmunoGen, Inc. (NASDAQ:IMGN)</strong> shares have been on a tear in 2018, advancing more than 75% already this year. What's more, IMGN stock could have room to run, if recent history is any indicator. Meanwhile, fellow biotech <strong>Exelixis, Inc. (NASDAQ:EXEL)</strong> reports earnings next week, and EXEL stock's recent pullback to a key trendline could mean now is the time to jump on the longer-term uptrend.</p> <h2>IMGN Options Signal Has Been Bullish</h2> <p>IMGN stock appeared on our radar after sending up an options signal. Specifically, the security is one of the few stocks currently trading near a 52-week high, while simultaneously sporting relatively inexpensive near-term options. The stock's Schaeffer's Volatility Index (SVI) was at 130% yesterday, at the bottom of its annual range. Since 2008, this signal has flashed for IMGN only two other times, after which the equity went on to rally 17.78%, on average, over the next month!</p> <p>As alluded to earlier, ImmunoGen stock has been on fire, more than quadrupling in just the past year. The security notched a two-year high of $12.05 on Wednesday, and was last seen trading at $11.28, up 3.9% on the day. Another 17.78% rally from current levels would place IMGN around $13.29 -- territory not charted since early 2016.</p> <p>Despite the biotech stock's stellar advance, IMGN remains plagued by pessimism. The equity's Schaeffer's put/call open interest ratio (SOIR) of 2.11 is at the top of its annual range, suggesting near-term traders haven't been more put-biased in the past year. An unwinding of pessimism in the options pits could add fuel to the stock's fire.</p> <p>Plus, short interest represents about a week's worth of buying power, at ImmunoGen stock's average daily trading volume, and 40% of covering analysts maintain tepid "hold" or "strong sell" opinions. A short squeeze or a flood of overdue upgrades could propel IMGN to new heights.</p> <h2>EXEL Could Be a Buy Before Earnings</h2> <p>Biotech Exelixis -- which makes cancer treatment <a href="https://www.schaeffersresearch.com/content/news/2017/12/20/exelixis-options-cheap-after-cancer-drug-scores-key-fda-win"><strong>Cabometyx</strong></a> -- will report quarterly earnings after the close on Monday, Feb. 26. The stock jumped 5.3% the day after its November earnings report, and the recent pullback could be a buying opportunity, if past is prologue.</p> <p>Specifically, EXEL stock is now within one standard deviation of its 80-day moving average, after a lengthy stretch above this trendline. According to Schaeffer's Senior Quantitative Analyst Rocky White, there have been 10 similar retreats to this trendline, after which EXEL shares rocketed 17.88% higher, on average, in the following month! </p> <p>The stock was last seen 0.8% lower on the day, trading at $28.86. From a longer-term standpoint, Exelixis stock has been in a channel of higher highs and lows since early 2016, and has skyrocketed more than 700% in that time frame. Another 17.88% rally from current levels would place EXEL around $34 -- north of its mid-October 17-year high of $32.50.</p> Should the company once again report well-received earnings next week, a short-covering rally could be in store. Short interest represents nearly five days' worth of pent-up buying demand, at EXEL stock's average pace of trading.
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<p>Even as rival Weight Watchers International, Inc. (NYSE:WTW) has <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/07/weight-watchers-stock-pops-chipotle-sinks-after-earnings">surged on the charts</a></strong>, weight loss specialist <strong>NutriSystem Inc. (NASDAQ:NTRI)</strong> has failed to gain any momentum. The stock is down 23.5% in 2018, last seen trading at $40.25, but it'll have a chance to turn things around with earnings scheduled for after the close on Monday. Unfortunately for shareholders, poor earnings reactions have played a major role in NTRI's underperformance in recent quarters. </p> <p>Specifically, the equity has moved lower in the session after earnings in three straight quarters, including two double-digit percentage slides of 10.5% and 12%, respectively, the last two times out. However, in this quarter last year, shares of NutriSystem surged almost 19% the session after reporting earnings. But considering the equity's dismal performance of late, that bull gap is nearly erased.</p> <p>Regardless of direction, it's clear the options market is expecting another big move out of NTRI. That is, implied volatility (IV) data is pricing in a move of 16.5% for Tuesday's session. On average, NTRI stock has swung 11.3% in either direction the day after earnings, looking back eight quarters.</p> <p>For what it's worth, a quick look at recent options action suggests bearish expectations, with the 10-day put/call volume ratio from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) coming in at 6.47. That ratio is in the 95th percentile of its annual range, underscoring a much healthier-than-usual appetite for long puts over calls in the past two weeks.</p> <p>Skepticism is ramping up elsewhere, too. In fact, the number of NutriSystem shares held by short sellers increased 21.3% in the last two reporting periods. More than 16% of NTRI's float is now dedicated to short interest. </p> <p>One group that has remained bullish is the analyst community. All six covering brokerage firms have "strong buy" ratings on NTRI -- leaving the door open for downgrades if the company again disappoints in the earnings booth next week. </p>
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<p><strong>Acacia Communications, Inc. (NASDAQ:ACIA)&nbsp;</strong>stock is down 18.5% to trade at $34.09, and just touched a new annual low of $33.68, after the software company posted fourth-quarter revenue that fell short of analyst estimates. The company also gave a weaker-than-expected full-year forecast for 2018. In response, Needham and D.A. Davidson downgraded the stock to "hold" and "neutral," respectively, while Morgan Stanley cut its price target on ACIA stock to $37 from $40. </p> <p> <strong><a href="https://www.schaeffersresearch.com/content/news/2017/11/03/analysts-react-to-earnings-from-acacia-communications-tableau-software">Acacia stock</a> </strong>is now on track for its worst day in history. The shares have been in a channel of lower highs and lows since their 2016 peak, with recent rally attempts contained by their 160- and 200-day moving averages. The equity has now given back 46% year-over-year and is currently on the short-sale restricted (SSR) list.&nbsp;</p> <p>Prior to today, analysts were hesitant to ditch the security. Of the 13 brokerages covering ACIA stock, 12 rate it a "strong buy" or "buy." Furthermore, ACIA's average 12-month price target of $47.42 represents a 39% premium from the stock's current perch. Continued technical underperformance could prompt more analysts to rethink their bullish positions. </p> <p>Options traders also remain optimistic.&nbsp;Ahead of today's drop, data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) showed ACIA with a 10-day call/put volume ratio of 8.20, ranking in the 96th percentile of its annual range. This suggests ACIA calls have been bought to open over puts at a faster-than-usual clip during the past two weeks of trading. Should ACIA stock continue to sink, it could lead to an unwinding of these bullish bets.</p>
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<p>Berenberg weighed in on banks today, saying several large-cap financial shares are overvalued. The brokerage firm specifically called out <strong>Goldman Sachs Group Inc (NYSE:GS)</strong>, <strong>JPMorgan Chase &amp; Co. (NYSE:JPM)</strong>, and <strong>Wells Fargo &amp; Co (NYSE:WFC)</strong> as the best stocks to short, considering "structural headwinds far outweigh" strong first-quarter revenue numbers, and that "downgrades will recommence as the rate cycle matures." Nevertheless, all three stocks saw their price targets hiked at Berenberg, on positive near-term expectations from rate hikes.</p> <h2>Goldman Sachs Bulls Buy Front-Month Calls</h2> <p>Goldman Sachs stock had its price target lifted to $200 from $190 -- though this remains well below last night's close at $261.43, as well as the average 12-month price target of $268.71. Out of the gate, GS shares are up 1% to trade at $264, and are on track to snap their four-day losing streak.</p> <p>Options traders are optimistic about the bank stock's short-term trajectory. The March 280 and 300 calls are home to peak open interest of 7,711 and 5,396 contracts, respectively. Data from the major options exchanges confirms mostly buy-to-open activity at each front-month strike, suggesting speculators are betting on a breakout to record highs by expiration at the close on Friday, March 16. The highest GS stock has ever traded is $273.75, hit on Jan. 29.</p> <h2>JPMorgan Chase Stock Overdue for Upgrades</h2> <p>Berenberg raised its price target for JPMorgan Chase stock to by $20 to $85. The last time JPM shares traded near $85 was in early June, and since then, they've shot more than 36% higher to $115.69, and tagged an all-time peak of $117.44 on Wednesday.</p> <p>Most analysts remain skeptical of the security, though. While 10 of 20 analysts maintain a lukewarm "hold" recommendation on JPM stock, the consensus 12-month price target of $120.07 stands at a slim 4.4% premium to current trading levels. Should the shares continue to move higher, a round of bullish brokerage notes could draw more buyers to the table.</p> <h2>Wells Fargo Options Traders Eye Record Highs</h2> <p>Wells Fargo stock's price target was raised to $45 from $35 at Berenberg, though the brokerage firm said it liked this bank the least and Citigroup (C) the most. Regardless, WFC shares are trading up 0.4% at $59.06, extending a mid-February bounce off their 200-day moving average. However, this recent rally has been contained by the round $60 mark, which coincides with an early February bear gap -- brought on by stiff regulatory restrictions following the bank's <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/05/wells-fargo-put-options-premiums-explode-after-fed-restrictions">fake account</a></strong> scandal.</p> <p>This near-term barrier hasn't stopped options traders from betting bullishly on the stock. WFC's weekly 3/9 66.50-strike call has seen one of the biggest increases in open interest over the past two weeks, with more than 10,047 contracts initiated. <strong><a href="https://trade-alert.com/home/" target="_blank">Trade-Alert</a></strong> indicates a number of these calls were bought to open on Monday, as traders eye a move to uncharted territory in the next two weeks. Wells Fargo stock hit a record high of $66.31 on Jan. 29.</p>
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<p>Shipping stock <strong>United Parcel Service, Inc. (NYSE:UPS)</strong> was downgraded to "hold" from "buy" at Deutsche Bank this morning, with the brokerage firm citing an unclear <a href="https://www.cnbc.com/2018/02/23/dont-buy-ups-shares-until-it-figures-out-its-relationship-with-amazon-deutsche-bank.html" target="_blank"><strong>relationship with Amazon</strong></a>. This comes just a day after the company announced the launch of its new <a href="https://www.reuters.com/article/us-ups-workhorse-group/ups-partners-with-workhorse-to-build-electric-delivery-vans-idUSKCN1G61S7" target="_blank"><strong>electric delivery van initiative</strong></a>. In response, the shares of UPS have fallen 0.3%, to $104.81 in early trading.</p> <p>From a broader perspective, United Parcel stock has had a <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/09/fedex-ups-shares-sink-on-amazon-blow">horrible year</a></strong> on the charts, shedding 11% year-to-date. The shipping concern touched a record high of $135.53 on Jan. 18, but has since shed 22%, moving below the 200-day moving average for the first time since July.</p> <p>Ahead of today's drop, data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows the shipping stock had a 10-day call/put volume ratio of 2.55, ranking in the 75th percentile of its annual range. This suggests UPS calls have been bought to open over puts at a faster-than-usual clip during the past two weeks of trading.</p> <p>What's more, the UPS Schaeffer's put/call open interest ratio (SOIR) of 0.32 ranks just four percentage points from an annual. This suggests that short-term speculators have rarely been more call-skewed toward the stock during the past 12 months.</p>
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<p>Fast food stock <strong>Wendy's Company (NASDAQ:WEN)</strong> will try to extend its upward momentum today after the shares jumped 4.1% yesterday on a well-received quarterly update. WEN is facing off against a round of mixed analyst attention, though. While BMO upped its price target on the stock to $20 from $17 this morning, SunTrust Robinson trimmed its target to $21 from $22. Of course, this latter mark still represents territory not seen since early 2007. As of yesterday's close 10 of 15 covering analysts had "strong buy" ratings in place on the equity. </p> <h2>Short Sellers Move In On WEN Stock</h2> <p>The shares were last seen trading at $16.88, not far from their Jan. 10 decade-plus high of $17.66. Overall, Wendy's is up 23.3% during the past year. The stock saw strong support from the 200-day moving average during the recent market turbulence. </p> <p>But many are skeptical the security's technical success can continue. Specifically, short interest increased by 10% in the last two reporting periods, and almost 15% of WEN's float is now controlled by these bearish traders. Based on average daily trading volumes, it would take almost two weeks for short sellers to cover -- suggesting there's potential for the stock to benefit from a short-squeeze.&nbsp; </p> <h2>Restaurant Stocks RRGB and WING Diverge Post-Earnings</h2> <p>Fellow restaurant stocks <strong>Red Robin Gourmet Burgers, Inc. (NASDAQ:RRGB) </strong>and <strong>Wingstop Inc (NASDAQ:WING)</strong>, meanwhile, are both making notable post-earnings moves today. RRGB shares are trading up 3.5% at $55 after the company posted a fourth-quarter earnings beat. WING on the other hand is sliding 8.1% to trade at $43, with duel price-target cuts from Wedbush and Barclays coming in after yesterday's earnings release. Earnings for the fourth quarter were better than expected but Wingstop's forecast fell short of estimates. </p> <p>Like Wendy's, Red Robin and Wingstop are both <strong><a href="https://www.schaeffersresearch.com/content/news/2018/02/06/analysts-like-these-2-heavily-shorted-stocks">heavily shorted</a></strong>. Almost one-third of RRGB's float is sold short, while short interest accounts for 23.5% of WING's float. </p>
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<p>Oil concern&nbsp;<strong>Cabot Oil &amp; Gas Corporation (NYSE:COG)</strong> is set to report fourth-quarter earnings before the market opens tomorrow. The stock came into the year trading near its Nov. 30 two-year high of $29.57, but has since shed 15.9%, and dropped below the long-term support of its 200-day moving average. Today, COG is 3.5% higher at $24.04 -- amid a positive <strong><a href="https://www.schaeffersresearch.com/content/ezines/2018/02/22/stock-futures-higher-despite-interest-rate-concerns">earnings reaction</a></strong> for Chesapeake Energy (CHK) -- but is running out of steam near $24.56, a 23.6% Fibonacci retracement of its 2018 high and low.</p> <p> Looking at its earnings history, COG has shown limited success, ending higher the day after earnings in just three of the past eight quarters. Overall, the shares have averaged a post-earnings swing of 3.5% in either direction in the session after the company reports, looking back two years. This time around, the options market is pricing in a larger-than-usual 5.9% move for Friday's trading.</p> <p>Another negative earnings reaction could spark a flood of bearish brokerage notes for the struggling oil stock. Of the 18 brokerages following COG, 14 carry "strong buy" recommendations. Plus, the average 12-month price target of $32.22 stands at a 34% premium to the equity's current perch.</p> <p>Likewise, the shares could be pressure should short sellers start to increase their bearish exposure. While Cabot stock was struggling on the charts, short interest fell more than 21% over the past two reporting periods to 3.30 million shares -- a low 3% of the security's total available float. </p>
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