TLDR
- GameStop shares rose 5.07% to $23.63 on Thursday with no new company updates
- Call options volume topped 233,000 contracts, about 100,000 above the 20-day average
- The put/call ratio dropped to 0.1, the lowest since July 21, showing strong bullish sentiment
- Traders focused on $23.50 and $24 strike prices expiring Friday
- Wall Street expects Q3 earnings of $0.20 per share and revenue of $987.3 million
GameStop shares climbed 5.07% to $23.63 on Thursday in a rally driven purely by options market activity. The video game retailer released no fresh news or updates to explain the move.
Trading volume in GameStop call options reached 233,000 contracts by Thursday’s close. That figure exceeded the stock’s average daily volume over the past 20 sessions by roughly 100,000 contracts.
The put/call ratio fell to 0.1, marking the lowest level since July 21. This means call options massively outweighed puts in Thursday’s trading.
When the ratio drops this low, it shows traders are betting heavily on upside price movement. The lopsided ratio reflects strong bullish sentiment among options traders.
Options Activity Targets Friday Expiration
Most of the trading activity concentrated on options with $23.50 and $24 strike prices. Both sets of contracts expire this Friday.
The focus on near-term strikes suggests traders expect more gains in the next few days. Heavy call buying can create upward pressure on the stock itself.
Market makers typically buy shares to hedge their exposure when call volume spikes. This hedging activity has pushed GameStop higher during previous rallies.
Implied volatility rose to 49.54, sitting in the lower quartile of the past year’s range. The volatility level suggests an expected daily price swing of about $0.71.
No Fundamental Changes Behind the Move
GameStop last reported earnings in September. The company posted a smaller loss than Wall Street expected.
The second quarter results showed earnings per share of $0.25, beating the $0.19 consensus estimate. Revenue came in at $972.2 million, topping forecasts of $900 million.
Those numbers are now more than a month old. No new financial data or company announcements emerged on Thursday.
The stock’s technical indicators paint a mixed picture. The RSI of 35.37 suggests the stock is approaching oversold territory.
The 20-day simple moving average sits at $24.63, above the current price. That creates potential resistance for further gains.
Wall Street analysts see earnings per share of $0.20 for the third quarter. That would represent a jump from $0.06 in the same quarter last year.
The current market cap stands at $10.26 billion. Institutional ownership is 39.99%, while insiders hold 10.52% of shares.
GameStop’s beta of 2.37 means the stock moves more than twice as much as the broader market. The company’s current ratio of 11.37 shows strong liquidity on the balance sheet.
Call options volume reached 74,000 contracts in separate reporting, with implied volatility climbing 2.2 points during the session.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
