Cisco Systems, Inc. (NASDAQ:CSCO) is trading lower today, after the company announced that a group of hackers have compromised more than 500,000 routers and other devices in several countries. Cisco suspects this was the work of the Russian government, and its ultimate plan was to launch a major cyber attack on Ukraine. Shares of CSCO have shed 0.8% on the news, last seen at $43.28, falling back below the 80-day moving average and pacing for their lowest close since April 13. This trendline, a previous level of support, was brought back into play by the stock’s post-earnings bear gap last Thursday.
Longer term, the networks specialist has been strong on the charts, up 36.4% over the last year. This technical success has earned the stock almost exclusively bullish attention from analysts, with 18 of the 20 in coverage saying to buy the shares. Also, the average one-year price target from this group is $49.74, which prices in upside of almost 15%.
Options traders across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have been bullish, too. CSCO sports a 10-day call/put volume ratio of 3.07 across these exchanges, a number that ranks in the top quartile of its annual range. So not only has call buying tripled put buying, but such a preference for calls over puts is pretty rare.
It’s a similar setup in today’s trading, despite the pullback, with call volume tripling put volume, and the July 44 call coming in as the most popular. But considering Cisco has a Schaeffer’s Volatility Index (SVI) of 18%, which ranks in the low 12th annual percentile, even put buyers can at least rest assured they’re getting relatively low volatility premiums at the moment.