Schaeffer's Trading Floor Blog

Biggest Movers: NQ Mobile Inc (ADR), Rackspace Hosting, Inc., and SunEdison Inc

NQ, RAX, and SUNE are moving sharply in Tuesday's trading

by 5/13/2014 11:28 AM
Stocks quoted in this article:

Around midday, three of the top movers are Internet service provider NQ Mobile Inc (ADR) (NYSE:NQ), cloud computing firm Rackspace Hosting, Inc. (NYSE:RAX), and alternative energy business SunEdison Inc (NYSE:SUNE). Here's a quick roundup of how this trio of names is performing on the charts so far.

  • NQ is off 6.7% today at $11.31 -- bringing its year-to-date deficit to 23% -- despite a lack of noteworthy news. The move lower is likely being cheered in NQ Mobile Inc's (ADR) options pits, where bearish betting has been all the rage. The stock's 10-day put/call volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) checks in at 1.79 -- higher than all other comparable readings from the past year. Also, NQ's Schaeffer's put/call open interest ratio (SOIR) of 1.97 -- which indicates put open interest roughly doubles call open interest among options expiring in the next three months -- is just 2 percentage points from a 12-month peak.

  • RAX has gained more than 9% at midday to trade at $30.06, following last night's first-quarter earnings beat. However, during the overnight hours, the equity still got hit with price-target reductions at five brokerage firms (though D.A. Davidson and Cowen and Company raised their respective price targets on Rackspace Hosting, Inc.). In general, the Street has been divided on the shares. RAX has received eight "buy" or better ratings from analysts, versus eight "holds" and two "strong sells." Meanwhile, the stock's consensus 12-month price target sits at a lofty $42.53.

  • Finally, SUNE is up nearly 3% at $18.41 today, despite UBS following Needham's lead in slashing its price target on the shares during the overnight hours. SunEdison Inc has been a technical standout for some time now, more than tripling in value on a year-over-year basis. Nevertheless, short sellers have been busy betting against the stock, as one-quarter of its float is sold short. At the average daily volume, in fact, it would take more than four sessions to buy back the shorted shares. In other words, SUNE could soon benefit from a potential short-covering rally, should its upward momentum continue.


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