Dell Technologies (NYSE:DELL) has wavered over the past few months as the post-earnings rally from May stalled out. Shares were trading at $456 on Friday, about 11% below the all-time high of $514. That consolidation faces its next test next week when the company reports quarterly results.
Options Market Points to Dell Stock Volatility After Earnings
Dell stock has shown some extreme volatility when it has published its financial results recently. It jumped by over 20% in a single day in May when it released stellar financial results. Before that, it jumped by 18% after releasing its numbers in March.
The options market is suggesting that the stock will see elevated volatility after releasing its numbers on Tuesday. For example, the implied volatility for options expiring next week has jumped to 110%, higher than the historical average of 75%.
The put/call open interest ratio has moved to 0.80, a sign that call open interest now outweighs put open interest, typically read as bullish. This, however, could also be a sign that investors are growing more nervous and hedging. Most of the call activity is concentrated between the $500 and $600 strikes, a 10% to 30% move above the current share price.
