Shares of fertilizer concern Corteva Inc (NYSE:CTVA) are 3.4% lower to trade at $70.87 this morning, after the company said it's planning on separating its seeds and chemical units. Deutsche Bank chimed in with a price-target hike in response to $90 from $83, adding to the already extremely bullish outlook; 17 of 22 analyst sport a "buy" or better recommendation.
Today's drop is seeing support at the ascending 100-day moving average, a trendline that hasn't been breached on a closing basis since May. After a July 3 record high of $77.41, the shares have consolidated between $70-$75, but still boast a 24% year-to-date gain.
Call traders have been moving in over the past 10 weeks. This is per CTVA's 50-day put/call volume ratio of 3.43 over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks in the 93rd percentile of readings from the past 12 months.
Echoing this, short-term traders have been extremely bullish. Specifically, CTVA's Schaeffer's put/call open interest ratio (SOIR) of 0.35 stands in the 2nd percentile of readings from the past 12 months.
A premium-selling strategy could be the move going forward, as CTVA's Schaeffer's Volatility Scorecard (SVS) checks in at a 7 out of 100. This means the security has consistently realized lower volatility than its options have priced in.
