Earnings Hedges Dominate as Put Buying Spikes Across the Board

Sentiment read: Options markets leaned defensively for the week of October 26. Earnings-driven put buying was the dominant theme, with multiple names hitting 52-week PCR highs ahead of results. A handful of exceptions showed aggressive call buying, pointing to selective bullish conviction in pockets of the market.

Notable Positioning Shifts

COLM, PCR 4.81, +4.4 SD Columbia Sportswear's put/call ratio hit 4.81 ahead of Thursday earnings. That is a 52-week high and sits 4.4 standard deviations above the 20-day mean of 0.56. Options traders positioned heavily for downside protection with the stock closing at $60.90.

AWI, PCR 4.75, +4.4 SD Armstrong World Industries posted the second-largest z-score breach of the week. Its PCR reached 4.75, nearly 4.4 standard deviations above the 20-day mean of 0.62. Defensive positioning was extreme relative to its own recent history.

HAFC, PCR 3.0, +4.3 SD, 52-week high Hanmi Financial's put/call ratio hit 3.0, the highest level in 52 weeks. It sat 4.3 standard deviations above the 20-day average of 1.12. That is the most bearish options positioning recorded for this name since tracking began.

THG, PCR 1.35, +4.0 SD The Hanover Group's PCR exploded to 1.35, four standard deviations above its 20-day mean of 0.60, ahead of Q3 earnings. Put buyers moved sharply ahead of results.

NSC, PCR 0.75, -4.0 SD Norfolk Southern was the week's clearest bullish outlier on the put side. Its PCR dropped to 0.75, four standard deviations below its 20-day mean of 1.28. That is the lowest reading since January 2021, pointing to a sharp rotation into calls.

LH, PCR 0.66, -4.1 SD, 52-week low Laboratory Corporation's PCR crashed to 0.66 post-earnings, the lowest in 52 weeks and 4.1 standard deviations below the 20-day mean of 1.16. Call buying surged after results, marking one of the week's strongest bullish options signals.

SGRY, PCR 0.40, +4.2 SD Surgery Partners bucked the defensive trend. Its PCR rose to 0.40, a 4.2 standard deviation move above the 20-day mean of 0.10, coinciding with a 51% one-week rally in the stock. Put activity increased in absolute terms, but the move reflected options-market participation across the board in a high-momentum name.

PBR.A, PCR 0.224, +4.2 SD Petroleo Brasileiro's preferred shares saw the PCR jump to 0.224, 4.2 standard deviations above the 20-day mean of 0.137. The stock fell 14.7% on the week. The absolute PCR remained low, but the relative spike confirms traders were buying downside protection into the sell-off.

BAND, PCR 1.026, +4.2 SD, 52-week high Bandwidth's put/call ratio reached its highest level in at least a year. At 1.026, it sits 4.2 standard deviations above the 20-day mean of 0.37. Options traders registered extreme bearishness in this communications software name.

CSL, PCR 1.23, +4.4 SD Carlisle Companies hit a PCR of 1.23, 4.4 standard deviations above its 20-day mean of 0.247, ahead of earnings. The z-score was among the highest of the week. Protective put demand surged sharply ahead of the print.

Sector Themes

Earnings hedging was the primary driver. The week's options activity was concentrated around scheduled earnings releases. Names including COLM, THG, CSL, LKQ, AWI, FR and WT all triggered high-severity PCR pulses within 24 hours of their results. Put/call ratios across this group showed outsized pre-earnings hedging that was well above historical norms.

Industrials and materials saw heavy defensive flow. NSC, AWI, PPG and BHP all registered significant PCR moves. BHP's PCR rose to 1.81, four standard deviations above its 20-day mean of 1.46, reflecting a bearish tilt in global mining. PPG traders pushed the PCR to 0.4472, 4.2 standard deviations above its mean of 0.32, ahead of Tuesday earnings.

Post-earnings call buying provided a bullish counterweight. LH and NSC both saw their PCRs fall sharply, reflecting call-side demand once results cleared. HGV also showed extreme bullish options positioning, with its PCR hitting 0.0601 against a 20-day mean of 0.031, alongside a reported 8.9% retreat in short interest over the prior month.

Small and mid-cap names dominated the z-score extremes. The highest standard deviation breaches this week came from names outside the large-cap index. HAFC, BAND, REPL and FTRE all triggered 4.1 SD or higher signals. This pattern suggests elevated uncertainty was not confined to mega-cap earnings but spread across a broad set of smaller names with thinner options liquidity.