Wait To Bet On Intel Stock Until After Earnings

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Intel (INTC) is preparing to report third quarter financial results after closing tomorrow, October 27. Wall Street expects the semiconductor concern to report earnings of 32 cents per share on revenue of $15.25 billion, both of which are year-over-year decreases. Below, we will take a look at how the equities have performed on the charts recently and trace some of the options activity around INTC ahead of the event.

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Today, Intel stock is struggling for direction, falling 0.7% last time to trade at $27.23. Shares have struggled with their 30-day moving averages for much of the year. They are currently trading above the trendline after a bear gap built up pressure on the charts at the end of July. Trending lower since its April 2021 peak, INTC now sits at a 46.6% year-on-year loss.

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A look at the equity’s history of post-earnings reactions during the past two years shows an overwhelmingly negative reaction. Intel stock fell the day after its last eight reports, shed more than 5% in every instance and post-earnings average decline of 8.1%. Now, the options market is pricing in a slightly higher move of 11.9%.

Meanwhile, short-term options traders are dealing with severe call-bias. That’s in line with Intel stock’s Schaefer put/call open interest ratio (SOIR) of 0.68, which sits in the lower 6th percentile of the annual reading.

Analysts, on the other hand, are more pessimistic. Of the 24 in coverage, only three rate INTC a “buy” or better, and the 12-month consensus target price of $34.27 is a 24.5% premium to current levels of trading.

Credit: www.forbes.com /

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