Netflix stock options priced for a big post-earnings move, but not quite as big as usual
Options on Netflix Inc.'s stock (NFLX) are priced for a near-double digit move on Friday, following the streaming video company reports fourth-quarter results which are due out after Thursday's closing bell. An options strategy known as a straddle, which is a pure volatility play that involves buying bullish (calls) and bearish (puts) options at that same price, is priced for a one-day post-earnings move of $31.20, or 9.7%, in either direction, according to data provided by Matt Amberson, principal at Option Research & Technology Services (ORATS). That's less than the average post-earnings moves over the past 12 quarters of $34.52%, or 10.7%, Amberson said. Based on current prices -- the stock was down 1.2% at $322.44 in afternoon trading Thursday -- a straddle buyer would start make money if the stock closes Friday below $291.24 or above $353.64. Over the past 12 quarters, the stock moved more than 9.7% just three times, according to FactSet data. Also, the stock rose after the past two quarterly results, but fell after nine of the past 12 reports. The stock has run up 18.4% over the past three months, while the S&P 500 has gained 6.0%.
(END) Dow Jones Newswires
January 19, 2023 14:24 ET (19:24 GMT)
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