Investors in Extreme Networks (EXTR) Need to Pay Close Attention to Stock’s Recent Moves in the Options Market

Extreme Networks Inc (EXTR) is a Zacks Rank #5 (Strong Sell). Despite the company’s weak fundamentals, its stock has been experiencing high implied volatility in the options market. This suggests that investors are expecting a big move in the stock price in the near future.

Investors in Extreme Networks (EXTR) Need to Pay Close Attention to Stock’s Recent Moves in the Options Market

Investor Extreme Network Inc (EXTR) needs to pay close attention to stock-based moves in the options market. Lately, December calls have the highest implied volatility of equity options today. Implied volatility shows how much movement the market expects in the future.

Option traders often look for high implied volatility to sell premium strategies. Many seasoned traders use this strategy to capture decay as expiration approaches, hoping the underlying stock doesn’t move as much as originally expected.

Given the way analysts feel about Extreme Networks right now, huge implied volatility could mean there’s a trade developing. Often, options traders look for stocks with high implied volatility to sell premium strategies.

Extreme Network’s Zacks Rank is Sell. The computer network industry ranks in the bottom third of Zacks Industry Rank.

In the last days, analysts increased earnings estimates for the current quarter. Two analysts revised estimates downward. The net effect is that the Zacks Consensus Estimate for the current quarter is 5 cents per share, down 2 cents for the period.

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