Traders see Amazon's stock soaring even higher after the company's blockbuster earnings

  • Amazon has spiked to a record high after crushing its third-quarter earnings report.
  • Options traders are responding by making even more bets on the stock to rise further in the coming months.

Amazon surged to record highs yet again, but investors still can’t get enough.

Options investors are piling into bets that the stock, already up 45% this year, will continue to climb. As of mid-day on Friday, the six Amazon options with the most open interest — defined as outstanding contracts trading at once — were all calls.

When purchased, call contracts are used to make bullish wagers, and are a popular way for traders to capture future upside in a stock.

So how big of an increase are we talking from the company’s current trading price of $US972.43 a share as of Thursday’s close? Let’s break down the options in play.

Note that, at roughly $US1,088 at the time of this article’s writing, Amazon has already blown through a couple of these strike prices, meaning traders are already reaping profits.

  • Call contract betting the stock would increase 23% to hit 1,200 by January 19

    • Open interest: 11,142
  • Call contract betting the stock would increase 13% to hit 1,100 by January 19

    • Open interest: 9,635
  • Call contract betting the stock would increase 5.9% to hit 1,030 by November 17

    • Open interest: 7,571
  • Call contract betting the stock would increase 18% to hit 1,150 by January 19

    • Open interest: 6,884
  • Call contract betting the stock would increase 13% to hit 1,100 by November 17

    • Open interest: 6,784
  • Call contract betting the stock would increase 2.8% to hit 1,000 by November 17

    • Open interest: 6,264

This bullishness certainly aligns with analysts across Wall Street. Out of 49 of them who cover the company, 45 have buy ratings, while 3 have holds and just one has assigned a sell. The average price target for the group is $US1,241.41, roughly 28% above Thursday’s close.

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