Schaeffer's Trading Floor Blog
Stocks quoted in this article:

U.S. stocks are mostly higher at midday, as traders weigh a mixed bag of economic data ahead of next week's highly anticipated Fed meeting. Among the equities in focus are financial concern Citigroup Inc (NYSE:C), as well as tech issues Ciena Corporation (NASDAQ:CIEN) and salesforce.com, inc. (NYSE:CRM), which have all attracted the attention of analysts.

  • C is up 0.6% at $50.54, after HSBC lifted its price target to $48 from $36. While most analysts are already bullish when it comes to C -- the stock boasts 17 "buy" or better ratings out of 21 total recommendations -- near-term option traders prefer puts over calls. In fact, the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.11 stands just 4 percentage points from a 52-week peak, implying that short-term speculators have rarely been more put-biased during the past year. On the charts, Citigroup Inc (NYSE:C) has added more than 46% over the last 12 months, meaning some of those puts -- especially the out-of-the-money variety -- could've been bought to "insure" long stock positions.

  • Moving on, CIEN is also reaping the benefits of a bullish brokerage note, tacking on 2.3% to $25.13, after Jefferies hiked its price target by $2 to $22. CIEN has outperformed the broader S&P 500 Index (SPX) by nearly 18 percentage points during the past three months, and tagged a new two-year high of $25.32 earlier this week. A short-squeeze situation could add contrarian fuel to the fire, as short interest represents eight sessions' worth of pent-up buying demand, at Ciena Corporation's (NASDAQ:CIEN) average pace of trading.

  • Finally, CRM is taking a breather from its long-term ascent, despite a price-target boost to $60 from $54 at Roth Capital. The shares notched a record high of $50.60 just yesterday, bringing their year-to-date gain to 17.3%. However, while CRM -- last seen at $49.31 -- has outperformed the SPX by 28.4 percentage points during the past three months, short interest still accounts for 9.7% of the stock's total available float. In fact, it would take almost seven sessions to buy back all of these bearish bets -- ample sideline cash for a potential short-covering rally to add fuel to salesforce.com, inc.'s (NYSE:CRM) fire.

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