C3.ai Stock Sells Off After Dismal Prelminary Results

Core Insights - C3.ai Inc's stock has experienced a significant decline, dropping 26% to $16.40, following a pre-announcement of first-quarter earnings and revenue that are expected to be dramatically below estimates [1] - This decline marks the company's worst single-session drop ever, with shares reaching a two-year low of $14.70 and being 53% lower in 2025 [2] - D.A. Davidson downgraded the stock to "underperform" from "neutral," reducing the price target from $25 to $13, while UBS and Wedbush also lowered their price targets to $23 [1] Trading Activity - Options traders have shown a strong preference for call options, with 60,362 calls bought to open in the past two weeks compared to only 5,494 puts, resulting in a call/put volume ratio of 10.99, indicating a peak in call buying activity [3] - Today, 214,000 calls have been traded, which is 11 times the average intraday volume, with the August 23.50 call being the most popular among traders [4] - Approximately 20% of C3.ai's total available float is sold short, suggesting that some call purchases may be hedging against short positions [3]