Toyota slashes current-year earnings forecast by 20%, stock slumps

Toyota saw profits fall 33% for its fourth fiscal quarter

The actions of Toyota Motor Corp (NYSE:TM) are down 2.8% at $161.77 this morning, following warnings from the car and truck maker that its profits for the current fiscal year could fall by more than 20%, thanks to the rise raw material costs. To cushion the impact, Toyota said it would consider alternative materials and other expense-cutting tactics. Additionally, the company reported a 33% decline in earnings for its fourth fiscal quarter, which was impacted by the chip shortage and the recent Covid-19 lockdowns in China.

TM is down more than 10% year-to-date, although it still held on to a 9.3% year-over-year lead heading into today. However, it just broke a recent low at the $165 level at the open, with air pressure guiding the stock lower since mid-February.

The security’s options pits are still quiet, but volume is six times the intraday average, with 361 calls and 110 puts traded so far. By far the most popular is the June 190 call, followed by the May 135 put, where positions are sold to be opened.

This penchant for long calls is nothing new. On the International Securities Exchange (ISE), Cboe Options Exchange (CBOE) and NASDAQ OMX PHLX (PHLX), TM has a 50-day call-to-sell volume ratio of 3.23, which exceeds 79 % of readings last year. . In other words, there has been a healthier than usual appetite for these bullish bets lately.

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