Investors Down on New Century Despite High?

Although the stock of New Century Financial Corp., Irvine, Calif., reached a new all-time high on Nov. 10, investors are "quite pessimistic toward the equity," according to an "Option Byte" issued by Schaeffer's Investment Research, Cincinnati.Put-option volume on Nov. 10 exceeded five times the average put volume for New Century stock, Schaeffer's said. Put options outstanding on New Century outnumber calls by a ratio of over 150 to 100. "Also illustrating a large amount of pessimism is the high level of short interest on New Century," Schaeffer's said. "Total short interest represents more than 13% of the floated shares, which could easily help to power a short-covering rally." According to Yahoo, New Century reached a high of $63.60 Nov. 10, but settled down to $62.05 late in the afternoon. In related news, Piper Jaffray initiated coverage on New Century Financial, rating it "outperform."