BlackBerry Ltd (NYSE:BB) stock is consolidating above penny stock territory, last seen up 10.2% to trade at $5.97, after a Wall Street Journal report praised the company's pivot into the software sector. The article highlighted its QNX operating system, which powers driver-assistance features such as collision warnings, blind-spot notifications, and adaptive cruise control. The software is already used in roughly 275 million cars, and accounts for half of Blackberry's total revenue.
BB earlier notched a 52-week high of $8.48 and now boasts a 56.2% year-to-date lead. The security is also bouncing off the $5 level and trading well above all short- and long-term moving averages.
The equity looks ripe for a short squeeze. Short interest rose 17.6% in the last two reporting periods, with 30.48 million shares sold short-- representing 5.2% of BlackBerry stock's available float.
Options traders are firmly bearish, per BB's 50-day put/call volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) that ranks in the 97th percentile of readings from the last 12 months. In other words, an unwinding of pessimism could keep tailwinds blowing for the stock.
That shift is already underway, with 61,000 calls exchanges so far today -- triple the amount typically seen at this point. The most popular contract is the weekly 5/8 6-strike call, where new positions are being bought to open.
