COST call volume is today running at double the intraday average
Last night, Costco Wholesale Corporation (NASDAQ:COST) shared strong comparable sales results for December, up 10% year-over-year to $26.15 billion as customers looked for cheaper groceries amid high inflation. In response, Oppenheimer and Jefferies hiked their price objectives to $695 and $755 from $675 and $725, respectively.
COST was last seen up 1.3% to trade at $656.46, as it bounces off support from the 20-day moving average toward its Dec. 27, record high of $558.58. The equity also sports a 49.1% year-over-year lead. More bull notes could be in store, considering the shares’ 12-month consensus price target of $669.52 is a slim 2.1% premium to its current perch.
Options bulls are also chiming in, with 17,000 calls exchanged so far — double the intraday average volume — and almost triple the number of puts traded. The most active contract is the weekly 1/5 670-strike call, where positions are being bought to open.
Short-term options traders have been more bearish than usual. This is per the security’s Schaeffer’s put/call open interest ratio (SOIR) of 1.38 that ranks higher than 92% readings from the past year. Should this pessimism continue to unwind, the equity could move higher still.