SJM reports this morning with options markets at their most defensive reading of the past year — a sharp escalation from the already-elevated caution flagged in prior coverage.
The options signal has intensified dramatically since the August 22 preview. The put/call ratio jumped to 1.205 on Tuesday — the highest reading of the past 52 weeks and nearly four standard deviations above its 20-day average of 0.67. To put that in context, the August 22 article flagged a PCR of 0.754 at 1.7 standard deviations as a caution flag. That same ratio has since surged 60%, blowing past the prior 52-week high. This is no longer a cautious lean — options traders moved aggressively into downside protection on the final session before the print.
The borrow market, by contrast, remains entirely unbothered. Availability is essentially unlimited — the lending pool is almost entirely unused, with borrowing costs at just 0.33% annually, near their lowest level of the month. Short interest has trimmed 8% on the week to roughly 5.2% of the free float. Bears are not piling in via the borrow market; the defensive action is concentrated entirely in options.
Analyst sentiment into the print remains constructive, though a split persists. UBS and Jefferies both hold Buy ratings with targets at $142 and $140 respectively, and JP Morgan's Overweight carries a $139 target — all lifted within the past two weeks. The consensus mean of $127.69 sits just above the current price of $125.45. Bulls are anchored to Uncrustables' growth runway and the Hostess integration story. Bears point to private-label competition, macro pressure on consumer volumes, and a recent note flagging weaker-than-expected Q3 trends with trimmed guidance. TD Cowen's Hold at $123 sits below the current price — the one dissenting voice among the recent movers. The last two earnings prints offer some historical grounding: SJM rose 2.8% the day after the August 12 report and 15% after the June 9 release, both over five-day windows that extended the gains.
Today's print tests whether the Uncrustables and Hostess narratives can deliver the volume and margin outcomes that justify a stock up 6% on the month — and whether the surge in put buying reflects genuine fundamental concern or simply last-minute hedging ahead of a binary event.
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