Bullish investor with book

PINS trades at more than four times its market price

The proportions of the social media name Pinterest Inc (NYSE: PINS) reclaimed the $ 76 mark that has been a resistance area for the past few weeks and is four times the IPO price. Thanks to a solid gain of 13% over the past seven days, the security has moved away from its breakeven point since the start of the year and now is a good time to speculate about the next step in PINS with calling options.

While analysts are mostly bullish on Pinterest stock, there is still room for upgrades that could propel stocks higher. Of the 19 in question, six still have a lukewarm “hold” rating.

However, short sellers continue to pile up. Short interest has risen 61% since the beginning of the year and is only 20% below the record high since the stock went public. In fact, short rates rose 7.3% over the most recent reporting period, and the 21.91 million short stocks sold now account for a whopping 25.4% of the stock’s available free float. With the exception of those who took positions in February, these shorts are now underwater.

Additional tailwind could come in the form of a shift in sentiment in option pits. This corresponds to the 50-day put / call volume ratio of Pinterest shares on the International Securities Exchange (ISE), the Cboe Options Exchange (CBOE) and the NASDAQ OMX PHLX (PHLX), which is in the 99th percentile of their annual range . In other words, long puts are recorded with a faster than usual clip.

PINS options can now also be offered at a bargain price. The security’s Schaeffer Volatility Index (SVI) of 52% is at the lowest percentile for the past 12 months or its lowest level since May 2020. In other words, the stock currently has bonuses at attractive prices. Finally, our call recommendation has a leverage ratio of 4 and will double if the underlying equity increases by 23.7%.

Subscribers to Schaeffer’s option recommendation service for weekend traders received this PINS comment on Sunday evening along with a detailed recommendation for options trading – including complete entry and exit parameters. Find out more about why Weekend Trader is one of our most popular options trading services


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