Biopharmaceutical inventory AstraZeneca PLC (NASDAQ:AZN) settled around the $64.52 level on Friday, which also marks its $200 billion market cap as well as two prior highs in November 2021 and July 2020. Given this strong technical setup, it now appears to be the perfect time to buy calls on AZN.
An easing of pessimism among options traders could put additional tailwinds on the stock’s back. Its Schaeffer put-to-call open interest ratio (SOIR) of 1.10 is above 94% of last year’s readings, meaning short-term options traders are extremely biased right now. Additionally, similar readings have had bullish implications for AZN in the past.
Echoing this, the 10-day buy/sell volume ratio of 1.23 on the International Securities Exchange (ISE), Cboe Options Exchange (CBOE) and NASDAQ OMX PHLX (PHLX) is in the 94th percentile. of its annual range. In other words, long puts are recovered at a much faster clip than usual.
Shifting gears, although it looks like the shorts have been targeting the stock, with short interest up 40% in the last reporting period, the stock is up around 15% which in turn involves a force.
AstraZeneca could also benefit from new analyst coverage. Only five analysts are currently covering the stock, with four at a “strong buy” rating and one at a “hold” rating.
Finally, our recommended call option has a leverage ratio of 6.5 and will double with a 16.1% rise in the underlying stock.
7 risky stocks to buy as inflation remains at record highs
Inflation has gone from a transitory problem that would take care of itself to an existential threat that drives the Federal Reserve to take swift and aggressive action. In January 2022, the Consumer Price Index (CPI) showed that 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 assets to risk assets. This is having a negative effect on many stocks, especially in the technology sector, which no longer justify their extended valuations.
But investors are also seeing falling prices for cryptocurrencies and other speculative assets. This may be a short term phenomenon, but if you are an investor looking to make money in 2022; it’s time to get a little defensive. But playing defensive doesn’t mean accepting mediocre growth. It simply means looking to stocks and sectors that are likely to benefit from high inflation and rising interest rates.
This is the subject of this special presentation. We urge you to consider these seven risky stocks that seem strong candidates to rise in value even if inflation remains high.
Check out “7 Risky Stocks to Buy as Inflation Remains at Record Highs”.