Puts were the options of choice on Raytheon Company (RTN -
42.88) Friday, with more than 6,400 contracts crossing the tape.
This activity quadrupled the equity's average daily put volume. On
the other hand, fewer than 2,400 calls changed hands during the
This inclination for bearish bets is backed by data from the
International Securities Exchange (ISE), Chicago Board Options
), and NASDAQ OMX PHLX (PHLX). Speculators on these exchanges
bought to open 2,603 puts on RTN Friday, compared to just 10 calls,
which gave the shares a single-day put/call volume ratio of
The stock's 10-day ISE/CBOE/PHLX put/call volume ratio of 6.17
confirms that puts bought to open have easily outnumbered calls
during the past two weeks. This ratio sits just four percentage
points from an annual high, signaling that traders on these
exchanges have rarely purchased bearish bets over bullish at a
faster pace over the past year.
Elsewhere on the Street, short interest on RTN rose 2.1% over
the most recent reporting period, but these pessimistic positions
account for 1.8% of the equity's float. At RTN's average pace of
trading, it would take two sessions to cover these shorted
Thanks to the
sell-off in the wider equities market
, RTN is down about 2.5%, deepening its 5.1% year-to-date deficit.
Currently, the shares are trading below their 100-day moving
average but they're now testing support at the $42 level. This
former area of resistance has acted as a technical floor since
However, should RTN extend its long-term retreat, there could be
analyst downgrades in store. According to Zacks, there are eight
"buy" or better endorsements, 10 "holds," and not a single "sell"
Considering RTN's lackluster technical performance, a submission
by any of these bullish holdouts could knock the security lower in
the near term.