Box Stock Downgraded on Lackluster Guidance

The security also attracted three price-target cuts

Box Inc (NYSE:BOX) yesterday reported slightly better-than-expected second-quarter earnings of 36 cents per share and revenue of $261.43 million. However, the company’s fiscal third-quarter outlook and full year missed estimates. Plus, Box expanded its stock buyout program by $100 million. 

The security is down 10.7% at $27.51, after a downgrade from Craig-Hallum to “hold” from “buy” and price-target cut to $30 from $35. Two other analysts slashed their price objectives as well. This denotes a sentiment shift, as eight of the nine firms in coverage rated BOX a “buy” or better coming into today.

The security is today trading at its lowest level since late May, as it slips below its previously supportive 60-day moving average, after running into a ceiling at the $32 region twice in July. BOX is today pacing for its biggest single-day percentage drop since March, and is down 10.5% in 2023.

Short-term options traders are more bearish than usual, per the equity’s Schaeffer’s put/call open interest ratio (SOIR) of 1.08 that sits in the 97th percentile of readings from the past 12 months.

Drilling down to today’s options activity, 1,860 puts and 1,475 calls have been exchanged, or 19 times the volume that is typically seen at this point. Most active is the December 23 call, where new positions are being opened.

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