Stocks quoted in this article:
Analysts are weighing in today on pastry purveyor Krispy Kreme Doughnuts (NYSE:KKD - 6.55), discount retailer Dollar Tree, Inc. (NASDAQ:DLTR - 49.11), and networking equipment supplier Brocade Communications Systems, Inc. (NASDAQ:BRCD - 5.63). Here's a quick roundup of today's bullish brokerage notes.
- As KKD prepares to report fiscal quarterly earnings next week, Wedbush started coverage of the stock today with an "outperform" rating. However, despite a year-over-year decline of about 9%, calls are still the options of choice on the equity. The 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio sits at 15.33, indicating that traders have bought to open more than 15 calls for every put during the past few months. This ratio arrives in 61st annual percentile, signaling that speculators have been scooping up calls over puts at a slightly accelerated clip.
- Meanwhile, DLTR scored a price-target hike to $57 from $56 at Wedbush this morning after the company revealed a 26% jump in second-quarter earnings yesterday. Although the security has advanced by about 50% over the past year, near-term options players are still showing a preference for bearish options over bullish. The Schaeffer's put/call open interest ratio (SOIR) checks in at 1.18, conveying that puts outstrip calls among the front three-months' series of options. This ratio lands in the 59th percentile of its annual range, reflecting a healthier-than-usual appetite for puts over calls lately.
- BRCD received a slew of upward price-target adjustments ahead of the bell, thanks to higher-than-expected quarterly earnings results on Thursday. Specifically, Baird raised the stock to $7 from $6, while Thinkequity, FBN Securities, and UBS also lifted their respective price targets. Currently, the equity boasts a 12-month climb of about 70%, and has bested the broader S&P 500 Index (SPX) by north of 12 percentage points during the past month. It stands to reason that calls outweigh puts, as evidenced the security's 20-day ISE/CBOE/PHLX call/put volume ratio of 3.72. In other words, calls bought to open have nearly quadrupled puts during the last four weeks.