Schaeffer's Trading Floor Blog

Biggest Movers: Daktronics, Inc., DSW Inc., and VIVUS, Inc.

DAKT, DSW, and VVUS are moving sharply in Wednesday's trading

by 5/28/2014 12:05 PM
Stocks quoted in this article:

Around midday, three of the top market movers are scoreboard producer Daktronics, Inc. (NASDAQ:DAKT), footwear retailer DSW Inc. (NYSE:DSW), and biopharmaceutical firm VIVUS, Inc. (NASDAQ:VVUS). Here's a quick roundup of how this trio of names is performing on the charts so far.

  • DAKT is off roughly 9.4% at $13.11 -- and on the short-sale restricted (SSR) list -- after reporting a fiscal fourth-quarter earnings miss this morning. This move lower brings the shares to a 2014 deficit of 16.4%, and has them hovering below their historically supportive 50-week moving average -- which hasn't been breached on a weekly closing basis since November 2012. Not surprisingly, short-term options traders have been focused on DAKT put options of late. Daktronics, Inc.'s Schaeffer's put/call open interest ratio (SOIR) of 0.92 ranks near the top quartile of all readings from the past year, revealing a stronger-than-usual bias toward puts, relative to calls, among options expiring in the next three months.

  • A first-quarter earnings miss and lowered full-year guidance this morning have pressured DSW 26.5% lower to trade at $23.92, and onto the SSR list. Earlier, in fact, shares of the retailer touched a fresh two-year low of $23.58. These developments are likely being cheered in DSW Inc.'s options pits, where the equity has racked up a 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.36. While call-skewed on an absolute basis, the ratio sits higher than roughly two-thirds of readings taken in the last year, meaning traders have scooped up bearish bets over bullish at an accelerated clip recently.

  • Finally, VVUS has gained 6% to wink at the $4.95 level, following news that Aspen Investment Fund plans to bid for the biopharmaceutical company by June 13. In spite of today's gains, the shares are down 45.5% on a year-to-date basis. As such, sentiment toward VIVUS, Inc. is decidedly negative. Eight out of 10 covering analysts give the stock a "hold" or worse rating, and nearly 40% of the equity's float is sold short. These short sellers could begin to head toward the exits amid the recent takeover buzz, particularly if Aspen issues a healthier-than-expected offer.

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