Square Stock Sinks on Bear Notes

Square stock is trading lower midday

The 20 stocks listed in the table below have attracted the highest weekly options volume during the past 10 trading days, with data courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. Stocks highlighted in yellow are new to the list. Standing out this week is mobile payment platform, Square Inc (NYSE:SQ). Below, we'll take a closer look at the options activity surrounding the e-commerce company, and see how its been performing on the charts amid the work-from-home atmosphere.

Looking at White's data, over the past 10 days, 185,598 calls and 137,974 puts have crossed the tape. This afternoon,57,000 calls and 50,000 puts have been purchased, with the most popular today looking to be the May 70 put, where no fewer than 17,000 contracts exchanged.

In addition to the surge in options volume, SQ is seeing attractively priced premiums. The stock's Schaeffer's Volatility Index (SVI) of 60% sits in the 29th percentile of its annual range, implying that near-term options traders are pricing in relatively low volatility expectations.

Recently rising above the $80 region for the first time since early March, Square stock has enjoyed its early May bounce off the 20-day moving average. And although SQ is down 4% at $77.07 this afternoon, for the year, the equity remains up 23%.

Two analysts have downgraded SQ today, Stephens to "equal-weight" from "overweight" and BofA Global Research to "underperform" from "buy." The former did, however, hike its price target by $1 to $75, which remains elevated compared to the stock's average 12-month price target of $68.45.