Utility Stock Pops Before Third-Quarter Report

Utilities name NuScale Power Corp (NYSE:SMR) is charging higher this afternoon, up 6.6% at $38.01, at last check, as investors prepare for the company's third-quarter report, due out after the close tomorrow. Rebounding off a short-term pullback with help from the 126-day moving average, the equity is up 111% year-to-date. 

Put traders have been swarming the utility stock. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), SMR sports a 10-day put/call volume ratio of 5.24 that ranks in the 92nd annual percentile. Plus, the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.46 sits in the highest possible percentile of annual readings. Should this bearish sentiment begin to unwind, it could add another layer of support for the shares.

While short interest has dropped 17% in the past two reporting periods, it still accounts for 24.5% of the stock's total available float. At the stock's average pace of trading, it would take short sellers almost two days to buy back these bearish bets.

SMR tends to outperform after earnings, with six of the last eight reports producing impressive next-day pops, including a 21.6% lift in May. The stock averaged an earnings swing of 13.9% over the two years, while this quarter, analysts are expecting a larger-than-usual 19.1% move, regardless of direction.