Hewlett Packard Enterprise (NYSE:HPE) stock is down 6.1% to trade at $49.17 this morning, even after the tech company reported adjusted fiscal third-quarter earnings of $1.11 per share on $12.2 billion in revenue, both of which topped forecasts.
Hewlett Packard also hiked its full-year guidance, citing increased AI server demand. Supply bottlenecks and margin pressures are several of the overhangs prompting the selloff today. Analysts have made their moves, with six brokerages hiking their price targets and three others trimming theirs.
HPE is poised to close below its previously supportive 50-day trendline for the first time since July. Now, the 80-day trendline is stepping up. Year to date the stock is up 103%, thanks in large part to a massive post-earnings pop from June.
Options traders are out in droves. In just the first half hour of trading, 50,000 contracts have changed hands, volume that's six times the average intraday amount. The weekly 9/4 50-strike put leads the charge, while the September 55 call is not far behind.
Options are an intriguing play, per HPE's Schaeffer's Volatility Scorecard (SVS) of 88 out of 100. This suggests the equity has consistently realized higher volatility than its options have priced in.
