Schaeffer's Trading Floor Blog

Options Check-Up: LinkedIn Corp, First Solar, Inc., and Dollar General Corp.

Analyzing recent option activity for LNKD, FSLR, and DG

by 3/12/2014 5:02 PM
Stocks quoted in this article:

Among the stocks attracting attention from options traders lately are professional networking site LinkedIn Corp (NYSE:LNKD), alternative energy concern First Solar, Inc. (NASDAQ:FSLR), and discount retailer Dollar General Corp. (NYSE:DG). Below, we'll break down how options buyers are positioning themselves, and how much speculators are willing to pay for their bets on LNKD, FSLR, and DG.

  • Long put activity (compared to long call activity) has been heavier than usual in LNKD's options pits during the past two weeks. This is evidenced by the fact that the equity's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.87 ranks in the 72nd annual percentile. It's no wonder option traders are turning to the bearish side, with the shares currently down 6.6% from their Feb. 26 analyst-induced intraday high of $217.49 to trade at $203.08. Plus, short-term LinkedIn Corp options can be purchased at a discount right now, with the stock's Schaeffer's Volatility Index (SVI) of 38% ranking lower than 78% of comparable readings from the past year.

  • FSLR has also seen an uptick in put buying relative to call buying recently, as the equity's 10-day ISE/CBOE/PHLX put/call volume ratio of 0.68 ranks higher than 84% of similar readings from the past 12 months. Although the company's fourth-quarter earnings report is a couple weeks behind us, the stock's SVI of 69% is still slightly higher than usual, ranking in the 58th annual percentile. At today's close, First Solar, Inc. shares were positioned at $53.70 -- 7.5% below its Feb. 25 pre-earnings closing price of $58.03.

  • More than two calls have been bought to open for every put in DG's options pits of late, with the company preparing to report fourth-quarter earnings ahead of tomorrow's opening bell. While the resulting 10-day ISE/CBOE/PHLX call/put volume ratio of 2.58 appears bullishly skewed, the reading actually ranks in the 43rd percentile of its 12-month range, indicating the recent pace of call buying, relative to put buying, is actually slower than usual. Heading into the quarterly event, the equity's SVI of 41% ranks in the 49th annual percentile, demonstrating front-month option prices on Dollar General Corp. are about average, relatively speaking. On the charts, the shares are sitting 6% higher on a one-month basis to trade at $59.29.

permanent link
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT

Partner Center

© 2014 Schaeffer's Investment Research, Inc. 5151 Pfeiffer Road, Suite 250, Cincinnati, Ohio 45242 Phone: (800) 448-2080 FAX: (513) 589-3810 Int'l Callers: (513) 589-3800 Email: service@sir-inc.com

All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.

Market Data provided by QuoteMedia.com | Data delayed 15-20 minutes unless otherwise indicated.