Options Traders Make Bullish Bet On Amazon Earnings

Amazon.com, Inc. AMZN is expected to report its first-quarter 2021 earnings results after the closing bell Thursday.

Both Amazon’s e-commerce business and its streaming service have been boosted by the ongoing pandemic and analysts are expecting a blowout quarter.

For the first quarter of 2021, analysts expect Amazon’s revenue to increase 21% year over year to $107.9 billion and for its adjusted EPS to rise approximately 5% to $10.78.

Some options traders agree and think Amazon’s stock will make a bullish move on earnings. In total, two traders bet almost $3.36 million Amazon’s stock is going higher.

The Amazon Options Trades: Below is a look at the notable option alerts, courtesy of Benzinga Pro:

• At 9:37 a.m., Tuesday a trader executed a call sweep at the ask of 200 Amazon options with a $3,500 strike price expiring on April 30. The trade represented a $1.21-million bullish bet for which the trader paid $60.50 per option contract.
• At 9:39 a.m., a trader executed a call sweep at the midpoint of 369 Amazon options with a $3,500 strike price expiring on April 30. The trade represented a $2.15-million bullish bet for which the trader paid $58.38 per option contract.

See Also: Amazon Launches Fire Tablets For Kids, Fire HD 10 Series

Why It’s Important: When a sweep order occurs, it indicates the trader wanted to get into a position quickly and is anticipating an imminent large move in stock price. A sweeper pays market price for the call option instead of placing a bid, which sweeps the order book of multiple exchanges to fill the order immediately.

These types of call option orders are usually made by institutions, and retail investors can find watching for sweepers useful because it indicates “smart money” has entered into a position.

AMZN Price Action: Shares of Amazon gained 0.25% Tuesday, closing at $3,417.43. 

Photo courtesy of Amazon.