2 Reasons to Buy the Dip on Struggling Carvana Stock
Key takeaways
- CVNA KMX CBOE Carvana Co (NYSE:CVNA) stock is down 7.6% to trade at $64.71 today, weighed down by Car Max s (KMX) earnings report that detailed used-car market softness and subprime auto risks.
- Carvana sports a 10-day put/call volume ratio of 2.08 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) that stands higher than 94% of readings from the past year.
- This marks the 10th time in the last three years that the equity s 10-day buy-to-open put/call ratio crossed over 1.0 and hit the 90th percentile.
CVNA KMX CBOE Carvana Co (NYSE:CVNA) stock is down 7.6% to trade at $64.71 today, weighed down by Car Max s (KMX) earnings report that detailed used-car market softness and subprime auto risks. Despite a 23% year to date deficit, CVNA is flashing a historically bullish signal in its options pits.
Carvana sports a 10-day put/call volume ratio of 2.08 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) that stands higher than 94% of readings from the past year.
This marks the 10th time in the last three years that the equity s 10-day buy-to-open put/call ratio crossed over 1.0 and hit the 90th percentile. Per Schaeffer s Senior Quantitative Analyst Rocky White, CVNA was higher one month later 70% of the time after these signals with an average 24.4% return. From its current perch, this would put the stock back above its year-to-date breakeven level and pad its 10.3% year-over-year deficit.