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HomeTrading StrategiesRetail Inventory Flirting With Document Highs Earlier than Earnings

Retail Inventory Flirting With Document Highs Earlier than Earnings

Jefferies and Telsey Advisory hiked their value targets on ANF this morning

Retailers are rounding out the final of the earnings season, with Abercrombie & Fitch Co (NYSE:ANF) set to announce fourth-quarter outcomes earlier than the open on Wednesday, March 6. The shares have been final seen up 0.5% to commerce at $126.65, following price-target hikes from each Jefferies and Telsey Advisory to $149 and $140 from $120 and $105, respectively.

ANF earlier got here simply 1 cent shy of its Feb. 27, report excessive of $128.68, earlier than pulling again to help close to the $124 area. The fairness is on observe for its twelfth win within the final 14 buying and selling days, and sports activities a jaw-dropping 333.3% lead year-over-year lead, with a 43.6% achieve amassed already in 2024.

ANF Intraday

The fairness completed 5 of its previous eight post-earnings periods decrease, however was larger after the three most up-to-date next-day periods, together with a considerable 31.1% pop again in Could. ANF averages a transfer of 15.9% within the final two years, no matter route, however the choices pits are pricing in a barely bigger-than-usual swing of 16.4% this time. 

A post-earnings pop may spell hassle for brief sellers and extra tailwinds for ANF. Brief curiosity makes up 11.9% of the inventory’s obtainable float, and it might take over 4 days for merchants to purchase again their bearish bets.

Choices merchants have been betting on a transfer decrease. The safety’s 50-put put/name quantity ratio of two.14 over on the Worldwide Securities Alternate (ISE), Cboe Choices Alternate (CBOE), and NASDAQ OMX PHLX (PHLX) sits larger than 78% of readings from the previous yr. A shift in sentiment may push Abercrombie & Fitch inventory even larger.

It is also price noting that ANF’s Schaeffer’s Volatility Scorecard (SVS) checks in at a 81 out of 100. In different phrases, the safety has constantly realized larger volatility than its choices have priced in.

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