Another software stock is suffering from a sharp correction. MongoDB Inc (NASDAQ:MDB) is down 25% to trade at $236.42 today, after the software-as-a-service (SaaS) company's first-quarter profit forecast came in below estimates. The whiffed guidance is overshadowing an adjusted fourth-quarter earnings and revenue beat. The report is also dragging peers Okta (OKTA) and Snowflake (SNOW), which are off 3% and 4.7% respectively, at last glance.
No fewer than 18 analysts have issued price-target cuts in response, the lowest coming from Soctiabank to $275 from $415. With 30 of 39 brokerages maintaining "strong buy" ratings and not a single "sell" on the books, this shift had been coming.
MDB is trading at its lowest level since a 38.3% post-earnings bull gap on Aug. 27. The shares are now below their year-over-year breakeven level and sport a 14-Day Relative Strength Index (RSI) of 26, deep in "oversold" territory.
Options traders have been betting bearishly leading up to the event. The stock's 50-day put/call volume ratio of 1.19 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits higher than 90% of readings from the past year.
Today is a different trend. Over 18,000 calls have changed hands this morning, volume that's 11 times the average intraday amount. The March 330 call is the most popular standard contract, while new positions are being bought to open at the weekly 3/6 300-strike call.
