Schaeffer's Trading Floor Blog

Stocks to Watch Tuesday: Canadian Solar Inc., SunEdison Inc, and MannKind Corporation

Analyzing CSIQ, SUNE, and MNKD ahead of tomorrow's trading

by 4/7/2014 5:18 PM
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Momentum names that made notable moves on Monday and could continue to do so into Tuesday's session include solar energy concerns Canadian Solar Inc. (NASDAQ:CSIQ) and SunEdison Inc (NYSE:SUNE), plus biopharmaceutical firm MannKind Corporation (NASDAQ:MNKD). Here is a quick look at these stocks ahead of tomorrow's opening bell.

Canadian Solar Inc. (NASDAQ:CSIQ)

Canadian Solar was not immune to the sector-wide beating for alternative energy stocks today, as the stock plunged 8.5% to close at $28.35. Year-over-year, CSIQ has advanced by nearly an eight-fold margin; however, the equity has been on a downward spiral of late, shedding more than 36% from its five-year high of $44.50, tagged in late February. Given this downturn, short interest spiked a brow-raising 137.9% during the last two reporting periods, and now accounts for 11.7% of CSIQ's float. Still, at the stock's average daily volume, this amount of short interest doesn't even equate to one session's worth of pent-up buying demand -- meaning there is still plenty of room for more short-selling activity, which could create additional headwinds for the shares. With that being said, Canadian Solar ended up on the short-sale restricted (SSR) list in today's session.

SunEdison Inc (NYSE:SUNE)

SunEdison also took a hit today, dropping 8% to close at $17.41 after the company discontinued a solar power project in India, due to local equipment shortages and high prices. Like CSIQ, SUNE has been trending lower for about a month now, and is currently 20.6% below its five-year high of $21.93, tagged in early March. Furthermore, SUNE joined CSIQ on the SSR list today; however, calls were the contracts of choice, nearly doubling the expected daily volume. Most active by a landslide was SUNE's April 20 call, where it appears speculators sold to open positions, expecting the stock to remain below $20 through front-month expiration.

MannKind Corporation (NASDAQ:MNKD)

MannKind slid 8% to close at $6.32, after the FDA delayed the review date of the company's inhaled insulin treatment Afrezza. (Just last Wednesday, the equity spiked nearly 74% after an FDA advisory panel voted in favor of approving the drug.) Like the stocks mentioned above, MNKD was placed on the SSR list, and overall options volume more than doubled average daily levels, with the April 5 put receiving the most attention. This continues a recent trend in MNKD's options pits, considering the equity sports a 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.94, which ranks 2 percentage points from a 12-month peak. In other words, puts have been bought to open, relative to calls, at a near-annual-high pace during the past 10 weeks.

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