Investors look forward to the retailer Dick’s Sporting Goods (DKS) earnings report for the second quarter, which will be released ahead of tomorrow’s August 25th opening. Below we’ll examine DKS’s technical setup and examine some of its past performance after winning to get an idea of what it could mean for future sporting goods safety.
Dick’s Sporting Goods stock has played a role lately. The security pulled back briefly to its 40-day moving average last week but quickly rebounded from that area. In fact, this pop took DKS to a new record high during tonight’s session, and DKS is now aiming for its third consecutive day win. The 40-day price could be a trendline to watch as it caught several pullbacks before catapulting the stock higher for most of 2021.
DKS with 40-day moving average
The stock has also seen some impressive after-earnings returns over the past two years. That includes an increase of 16.9% from the last report in May and an increase of 18.6% the next day in November 2019. In those last eight sessions after the gains, DKS posted positive returns most of the time, averaging an 8 , 6% swing regardless of direction. This time around, option players are pricing in an even bigger move of 12.2%.
There was a lot going on in the option boxes today, with 7,643 calls and 5,731 puts on the tape – eight times what is normally seen at the time. The September 105 call is the most popular, followed by the weekly put of 8.27 90-strike. Positions are being sold to open on the latter, suggesting that these traders expect the $ 90 mark to act as the floor of the underlying stock until these contracts expire on Friday, August 27th.
Dick’s Sporting Goods stock could benefit from a short squeeze. Short rates are down 9.8% over the past two periods, but the 9.51 million stocks sold short still account for a whopping 15.2% of the stock’s available free float, and it would take over a week to see those bearish stocks Bet on the average of the share to buy back daily trading pace.
Depending on the company’s second quarter results tomorrow, a summary of upgrades could be in sight. Of the 18 reports, eight still describe the DKS as “hold” or worse. Meanwhile, the 12-month consensus price target of $ 118.56 is a low 4.7% premium over current levels.