Schaeffer's Trading Floor Blog
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Momentum names that made notable moves on Monday and could continue to do so into today's session include casino-entertainment concern Caesars Entertainment Corp (NASDAQ:CZR), oncology specialist Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA), and retailer Target Corporation (NYSE:TGT). Here is a quick look at these stocks ahead of the opening bell.

Caesars Entertainment Corp (NASDAQ:CZR)

Caesars bounced 4.4% yesterday to close at $19.14, as the consensus estimated loss for the company's first quarter has narrowed from three months ago. To be more specific, analysts, on average, now expect CZR to post an earnings loss of $1.15 per share, which would be a healthy improvement from last year's results. It seems as though option traders are also expecting good news from CZR when it hits the earnings stage after the close tomorrow. The stock boasts a top-heavy 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 58.58, with more than 58 calls bought to open for every put during the past two weeks. What's more, this ratio ranks the highest of all comparable readings from the past year, insinuating the recent rate of call buying, relative to put buying, is at a peak annual level. Likewise, the equity's Schaeffer's put/call open interest ratio (SOIR) comes in at a 12-month low reading of 0.52, demonstrating short-term CZR speculators are more call-focused now than they have been at any other time during the past year. Of note, however, some of this heavy call activity could be attributed to short sellers hedging against more near-term upside, or an earnings-induced pop -- nearly 20% of CZR's available float is currently sold short.

Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA)

Ariad -- which is headed into the earnings confessional tomorrow morning -- surged 5.5% yesterday to close at $7.63, after receiving an upgrade to "buy" from "hold," and a $6 price-target hike to $14, at Jefferies Monday morning. Looking into ARIA's options pits, calls have been bought to open over puts at a near-annual-high rate recently, as the equity's 10-day ISE/CBOE/PHLX call/put volume ratio of 20.77 ranks just 2 percentage points from a 12-month peak. Yesterday, although puts changed hands at more than double the average daily rate, calls remained the contracts of choice on an absolute basis, with the May 8 strike attracting the most attention. Perhaps short sellers were picking up options-related insurance to guard against additional upside (or a post-earnings spike), as roughly one-fourth of ARIA's available float is sold short right now.

Target Corporation (NYSE:TGT)

Target Corporation finished Monday's session 3.5% lower at $59.87, following the news that President and CEO Gregg Steinhafel is stepping down from his duties. In response, speculators exchanged options on TGT at a rate that nearly tripled the average daily pace. While puts and calls ran at a roughly even clip, traders did show a strong preference for short-term options, as each of the 10 most active strikes in TGT's options pits were slated to expire within the next 2.5 months. What's more, five of these strikes targeted the $60 level, indicating yesterday's speculators were placing bets on which side of this round-number mark TGT will end up on in the near term.


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