Fox Stock Double Downgraded on Cord-Cutting Concerns

FOXA calls are all the rage right now

The shares of Fox Corp (NASDAQ:FOXA) are up 0.4% to trade at $34.45 today, so far shaking off a downgrade from Atlantic Equities to "underweight" from "overweight." The brokerage firm also lowered its price target to $28 from $43, noting the cord-cutting trend is happening faster than expected, and will likely weigh on the media giant.

Since Fox went public as a standalone company in March, the stock has dug out a channel of lower highs and lows, culminating in an Aug. 26 bottom of $31.58. Plus, the subsequent rally from this bottom was stifled yesterday by the security's 30-day moving average.

The equity is at risk for more bear notes in the future. The 12 brokerages covering FOXA are evenly split with six "buy" or better ratings, compared to six "hold" recommendations, and zero "sells." Plus, the consensus 12-month price target of $40.91 is a 19% premium to current levels.

The mood in the options pits appears bullish. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), 88.64 Fox calls were bought to open for every put -- a ratio that sits in the 97th annual percentile, hinting at a much healthier appetite than usual for long calls over puts.

However, short interest increased by 36.6% in the two most recent reporting periods, and a healthy 5.1% of the security's total available float is sold short. So it's possible some of this recent call buying could be shorts seeking an options hedge against any unexpected upside.