November 30, 2023

Why Are Options Traders Blasting Tesla Stock?

Despite Jefferies slashing its price target on Tesla Inc (NASDAQ:TSLA) to $1,250 from $1,400 today, the security was last seen up 1.1% to trade at $915.53. TSLA is pacing for its fifth-straight daily pop, with rises of 3.7% or more seen in the last four sessions. Plus, Tesla stock has managed to add 39.2% over the past 12 months, despite falling from its Nov. 4, all-time high of $1,243.49. 

TSLA Chart March 21

Given this recent price action, it makes sense the electric vehicle (EV) powerhouse has landed on Schaeffer’s Senior Quantitative Analyst Rocky White’s list of stocks that have attracted the highest options volume during the past 10 days. According to the list below, over the last two weeks 6,457,493 calls and 6,057,380 puts have been exchanged. The most popular contract over this time period was the March 900 call.

MAO Chart March 21

International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) data shows puts have been increasingly in popularity over the past 10 weeks. This is per Tesla stock’s 50-day put/call volume ratio that ranks 99% higher than readings from the last 12 months, indicating a much healthier-than-usual appetite for bearish bets of late. 

Circling back to analyst sentiment, brokerage firms are split on TSLA. Of the 19 analysts covering the stock, 10 call it a “hold” or worse, while nine say “buy” or better. Meanwhile, the 12-month consensus price target of $952.63 is a slim 2.7% premium to current levels.

7 Risk-Off Stocks to Buy as Inflation Remains at Record Levels

Inflation has gone from a transitory problem that would take care of itself to an existential threat that is moving the Federal Reserve to take swift, aggressive action. In January 2022, the Consumer Price Index (CPI) showed inflation in the United States was at its highest level since 1982.

And the market is reacting predictably with what appears to be a shift from risk-on to risk-off assets. This is having a negative effect on many stocks, particularly in the tech sector, that are no longer justifying their extended valuations.

But investors are also seeing a drop in cryptocurrency prices and other speculative assets. This may be a short-term phenomenon, but if you’re an investor looking at how to make money in 2022; it’s time to get a little defensive. But playing defense doesn’t mean accepting mediocre growth. It simply means moving into stocks and sectors that are likely to benefit from high inflation and rising interest rates.

That’s the focus of this special presentation. We invite you to consider these seven risk-off stocks that look like strong candidates to increase in value even as inflation remains high.

View the “7 Risk-Off Stocks to Buy as Inflation Remains at Record Levels”.

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