Schaeffer's Trading Floor Blog

Stocks to Watch Friday: Avis Budget Group Inc. and Twenty-First Century Fox Inc

Analyzing CAR and FOXA ahead of tomorrow's trading

by 5/8/2014 4:57 PM
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Momentum names that made notable moves on Thursday and could continue to do so into Friday's session include car rental service Avis Budget Group Inc. (NASDAQ:CAR) and media tycoon Twenty-First Century Fox Inc (NASDAQ:FOXA). Here is a quick look at these stocks ahead of tomorrow's opening bell.

Avis Budget Group Inc. (NASDAQ:CAR)

Avis zoomed to a fresh decade-plus peak of $56.25 today, after the company dominated on the earnings front last night. Unfortunately, the stock's technical reign was short-lived, and by the end of the session, CAR had shed 4.2% to trade at $51.79. In the options pits, speculators exchanged contracts on both sides of the aisle at roughly twice the average daily rate, and the May 50 call saw the most activity overall. From a broader technical perspective, CAR is standing nearly 61% higher on a six-month basis, but maintains a significant amount of short interest. Currently, these bearish bets represent nearly two weeks' worth of pent-up buying demand, at the shares' average daily volume. As such, an extension of CAR's upward trajectory may create a short-squeeze scenario in the near term, which could give the stock an extra boost to higher highs.

Twenty-First Century Fox Inc (NASDAQ:FOXA)

Twenty-First Century Fox's stronger-than-expected earnings report for the fiscal third quarter (reported last night) sent the shares 6.5% higher today to close at $34.22. Meanwhile, in FOXA's options pits, calls roughly quadrupled puts, despite the latter's volume jumping to about two times the expected daily amount. Looking back at the past 10 weeks, long calls have outnumbered puts by a nearly 24-to-1 margin, resulting in a 50-day ISE/CBOE/PHLX call/put volume ratio of 23.84. What's more, this ratio ranks in the 78th annual percentile, conveying speculators have placed bullish bets over bearish at an accelerated pace recently.

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