Options traders are the loudest voice in the room right now. NGG — National Grid's US-listed ADR — reports on May 14. The market is not feeling calm about it.
The put/call ratio hit 0.88 on May 12. That is the highest reading since May 2021. The 20-day mean sits at 0.40. The current reading is nearly 3.7 standard deviations above that average — an exceptional statistical outlier for a utility stock. Put buying has roughly doubled in two sessions, jumping from 0.46 on May 11 to 0.88 the following day. Traders are paying for downside protection in size, and they are doing it right before tomorrow's earnings release.
The stock has slipped 3.4% over the past month, closing at $87.24 on May 12. The directional drift is modest. The options positioning is not.
Short interest added 11.5% in a single day on May 12, reaching approximately 1.18 million shares. That is a 12.9% weekly increase. The absolute level is modest relative to NGG's size, but the timing is pointed. Short sellers built positions quickly, in the 48 hours immediately before the earnings date.
The cost to borrow spiked sharply earlier this week — from near-zero on May 4 to 0.43% by May 12. The percentage move was dramatic. In absolute terms, 0.43% remains a low rate. Availability in the lending pool is still comfortable, meaning there is no squeeze pressure and shorts are not being forced out. The spike in borrow cost reflects fresh demand for shorts, not a constrained supply.
Two recent downgrades add texture. Jefferies cut NGG to Hold from Buy in March 2026. UBS went further — downgrading to Sell from Neutral that same month. Neither change is days-old news, but both sit unresolved ahead of tomorrow's print. The consensus has moved cooler on the stock over the past year.
Institutional holders remain substantial. BlackRock added 43.4 million shares in its most recent filing. Capital Research added 11.2 million. UBS Asset Management added 14.9 million. The big holders are not fleeing. But the options market and the short sellers are clearly hedging.
What to watch: Whether tomorrow's earnings print resolves or validates the put-buying spike. The last two earnings reactions for NGG were a 3.2% drop in March 2026 and a 3.2% gain in November 2025 — the stock moves on results. The options market is positioned for the downside scenario.
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