Amer Sports Shares Exhibit Volatility Amid Elevated Options Trading

Market Overview and Recent Performance

Amer Sports (AS) has experienced significant price fluctuations since its January 2024 IPO at $13. The stock initially surged 163%, reaching an all-time high of $42.36 on August 25. However, it has since declined 16% in the past month, closing at $34.14 recently. This downturn includes a 5.8% drop on Sept. 22, 2.8% on Sept. 23, and 0.5% on Sept. 24. The broader market context indicated a generally bullish sentiment on Wednesday's options trading day, with 64% of unusually active options being calls.

Unusual Options Activity Highlights Speculative Interest

The Oct. 17 $35 call option for Amer Sports (AS) garnered significant attention, registering as the fourth-highest Vol/OI (volume-to-open-interest) ratio among 1,394 unusually active options. Its volume reached 24,835 contracts, which was 109.89 times higher than its open interest of 226. This volume for the $35 call alone was 2.5 times the stock's 30-day average options volume. Three large trades between 11:06 and 11:15 a.m. accounted for 72% of the call's daily volume, suggesting concentrated activity potentially from long call buys or covered calls by existing shareholders. This heightened activity points to considerable speculative interest and potential near-term volatility surrounding the $35 strike price.

Factors Influencing Share Price

The recent 16% decline in Amer Sports' share price follows a period of rapid appreciation and suggests investor belief that the August 25 high marked a temporary market top. Some analysts had previously recommended profit-taking due to expected cooling off in the latter half of the year. Adding to the pressure, the company faced an environmental controversy related to a promotional fireworks display hosted by its subsidiary Arc'teryx in the Himalayas. This event sparked public backlash and concerns about brand image, leading Citigroup to lower its share price target for Amer Sports to $42 from $50. Leadership changes, such as the departure of Wilson CEO Joe Dudy, have also been cited as contributing to market skepticism. Furthermore, a previous 5.3% intraday decline was attributed to market skepticism regarding management's revised full-year guidance, which factored in 30% U.S. tariffs on Chinese imports.

Company Financials and Outlook

Amer Sports maintains ambitious long-term financial goals, targeting low-double-digit to mid-teens annual revenue growth and 30-70+ basis points of annual adjusted operating margin expansion over the next five years. The company recently reported strong Q2 2025 revenue of $1.24 billion, exceeding expectations and representing a 23.4% year-over-year increase. Its net margin was 3.93%, and return on equity stood at 6.87%. Despite these growth targets, the stock's valuation appears elevated. Analysts estimate Amer Sports will earn $0.85 per share in 2025, resulting in a current trading multiple of 40.2 times this year's consensus earnings. For 2030, projections are $2.53 per share, against which the stock trades at 13.5 times the estimate. The company has reiterated Q3 2025 guidance of $0.20-$0.22 EPS and FY 2025 guidance of $0.77-$0.82 EPS.

Options Trading Strategies Reflect Diverse Sentiment

The active Oct. 17 $35 call has spurred discussions on various options strategies, reflecting a mixed market sentiment from mildly bearish to highly bullish. A mildly bearish bear call spread involves selling an in-the-money call and buying an out-of-the-money call, aiming for maximum profit if the stock stays below $30 by expiration. A mildly bullish cash-secured call strategy involves buying the $35 call and setting aside funds to potentially purchase the stock, offering an annualized return of 109% in a bullish scenario. An over-the-moon bullish synthetic long position replicates owning the stock by buying a $35 call and selling a $35 put, generating a net credit of $1.05. This strategy capitalizes on anticipated upside.

Analyst Perspectives and Technical Indicators

Analysts have issued a "Moderate Buy" sentiment for Amer Sports, with price targets ranging from $35.00 to $45.00. The Barchart Technical Opinion suggests a "Weak Buy" in the near term, with an expected move of $3.09 over the next 23 days, potentially pushing the upper price to $37.23. Technical indicators show the stock trading near its 200-day moving average of $32.11, with an RSI at 34.39, suggesting potentially oversold conditions. The 50-day simple moving average is $38.11.

Broader Context and Implications

The contrast between Amer Sports' decline and the 1.8% surge in Nike (NKE) on the same day highlights specific investor concerns regarding Amer Sports' reliance on Asia-Pacific markets and direct-to-consumer expansion compared to its peers. The high implied volatility (IV) in its options, such as 52.24% for the $35 put and 47.27% for the $37.5 call, coupled with a 125.81% price change ratio for $32.5 puts, underscores the market's expectation of significant price swings. This elevated activity and mixed sentiment signal a highly speculative environment for Amer Sports stock.

Looking Ahead

Investors will closely monitor Amer Sports' ability to mitigate the impact of the Arc'teryx controversy and demonstrate consistent execution towards its ambitious long-term financial goals. The forthcoming Q3 2025 earnings report and any updates on tariff implications will be critical catalysts. The high level of options trading suggests continued volatility, offering both opportunities and risks for short-term traders, while long-term investors will evaluate the company's fundamental growth trajectory against its current valuation.