Boeing Company (BA)

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Options Bears Blast Boeing Stock After Earnings Disappoint
By: Schaeffer's Investment Research | April 27, 2022

• Boeing also paused production of its 777X plane

• BA is trading at 17-month lows

The shares of Boeing Co (NYSE:BA) are down 7.1% to trade at $155.20 this morning, after posting first-quarter earnings and revenue that missed Wall Street's expectations. The top- and bottom-line misses were chalked up to delays in its commercial airplane and defense development programs, as well as charges related to the war in Ukraine. In addition, the company said the production of its 777X plane has been paused, with deliveries expected to start in 2025 -- more than a year later than previously forecasted.

Options traders are already chiming in today. So far, 51,000 calls and 55,000 puts have crossed the tape, which is six times what is typically seen at this point, with volume pacing in the 100th percentile of its annual range. Most popular is the weekly 4/29 150-strike put, followed by the 155-strike put in the same series, with new positions being opened at both contracts.

A broader look shows this penchant for bearish bets is nothing new. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), BA's 50-day put/call volume ratio of stands higher than 93% of readings from the past year. This means that while calls are still outnumbering puts on an overall basis, puts have been getting picked up at faster-than-usual clip.

On the charts, Boeing stock is now trading at its lowest level since November 2020. Now facing pressure from every notable short- and long-term moving average, the equity is on track to lock in its biggest monthly percentage loss since the March 2020 broader market pullback. Over the last 12 months, BA is down 35.4%.

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