Warren Buffett’s Berkshire Hathaway took a $266 million stake in the cosmetics retailer
Ulta Beauty Inc (NASDAQ:ULTA) is up 14.5% to trade at $366.88 at last check, amid news that Warren Buffett’s Berkshire Hathaway (BRK) took a $266 million stake in the cosmetics retailer.
Shares are bouncing off an Aug. 13, three-year low of $318.72, as they pace for their first close above the 20-day moving average in nearly a month. The equity still carries a 24.8% year-to-date deficit, though.
Options are flying off the shelves, with 9,733 calls and 5,447 puts traded so far, which is 14 times the intraday average volume. The most popular contract is the August 380 call, where positions are being opened.
Short-term options traders leaned bullish prior to today’s headlines. This is per the equity’s Schaeffer’s put/call open interest ratio (SOIR) of 0.69, which ranks higher than only 7% of readings from the last 12 months.
Its also worth noting that the stock’s Schaeffer’s Volatility Scorecard (SVS) ranks at 85 out of 100. This means the security outperformed volatility expectations in the past year.