Schaeffer's Trading Floor Blog
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Momentum names that made notable moves on Wednesday and could continue to do so into Thursday's session include media entertainment company DreamWorks Animation SKG, Inc. (NASDAQ:DWA), real estate website Zillow Inc (NASDAQ:Z), and global hotel operator Marriott International Inc (NASDAQ:MAR). Here is a quick look at these stocks ahead of tomorrow's opening bell.

DreamWorks Animation SKG, Inc. (NASDAQ:DWA)

DreamWorks slid down the charts, after posting a first-quarter loss last night. At today's closing bell, the stock was 8.9% lower to trade at $24.03, extending its year-to-date deficit to more than 32%. What's more, DWA found itself on the short-sale restricted list not even 10 minutes out of the gate this morning, and consequently, the stock's put volume ramped up to 12 times the average daily amount, outpacing call volume by a more than 3-to-1 margin. On both sides of the aisle, the lion's share of DWA contracts crossed at May- and June-dated strikes. However, front-month puts stole the show, accounting for the top three most active options of the day.

Zillow Inc (NASDAQ:Z)

Zillow has had a busy start to the week, both on and off the charts. On Monday, the real estate website announced it had joined the Real Estate Standards Organization (RESO), while hedge fund Tiger Global Management LLC reported a 9.5% stake in the company later that evening. Subsequently, Z shares enjoyed a nice run up the charts into record-high territory at $110.98 earlier today, and after finishing the session 4.7% higher at $108.70, the stock is now situated 19.4% above its Monday closing price. In the options pits, Z calls changed hands at a rate that more than doubled the average daily speed. However, considering 31.4% of the stock's float is sold short, some of this heavy call activity -- particularly at the deep out-of-the-money May 135 strike -- may have come at the hands of short sellers hedging against more upside on the shares. Or, perhaps the traders were picking up options-related insurance against a potential earnings-induced pop, as Zillow is slated to report first-quarter earnings after the close next Wednesday, May 7.

Marriott International Inc (NASDAQ:MAR)

Marriott soared to a fresh record high of $58.38 today, following last night's upbeat first-quarter earnings announcement. At today's close, the stock maintained a 2.3% gain to perch at $57.93. Not surprisingly, speculators took to the options pits today, scooping up more than seven times the expected daily amount of contracts, with the May 55 put at the forefront of the action. Today's activity builds on MAR's longer-term options trend. The equity's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 3.25 ranks in the 93rd percentile of its annual range, demonstrating puts have been bought to open over calls at a near-annual-high rate during the past two weeks.


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