Schaeffer's Trading Floor Blog

Highs & Lows: Walgreen, Toyota Motor, and UBS

WAG, TM, and UBS scaled to new peaks

by 12/18/2012 1:57 PM
Stocks quoted in this article:

With homebuilder confidence at a six-year best, and increasing optimism toward fiscal-cliff negotiations, U.S. markets are decidedly higher this afternoon. Echoing this upbeat mood on Wall Street, the number of equities posting new highs is easily topping those at new lows. There are currently 155 peaks and 14 bottoms over on the NYSE, while the Nasdaq counts 70 tops and 13 lows -- most notably a guidance-induced multi-year worst for GT Advanced Technologies Inc (NASDAQ:GTAT - 3.02). Among the stocks charting notable moves are Walgreen Company (NYSE:WAG - 37.53), Toyota Motor Corporation (ADR) (NYSE:TM - 89.00), and UBS AG (USA) (NYSE:UBS - 16.70).

  • Shares of WAG are on the rise today, tagging a 15-month best of $37.57 earlier in the session, and prolonging their healthy 13.5% year-to-date gain. The equity could continue higher, should bearish options players yield to this upswing. WAG's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio sits at 1.78, signaling traders have bought to open 178 puts for every 100 calls during this timeframe. Moreover, this ratio arrives seven percentage points from an annual peak, implying that traders on these exchanges have rarely purchased puts over calls at a faster clip during the past year.

  • Japanese automaker TM made headlines today with a $17.4-million fine for delaying important recall information in the U.S., and said it's upping its 2013 manufacturing forecast to 9.9 million vehicles worldwide. Investors boosted the shares to the $89.22 level -- their loftiest price since March 2011 -- and also inflated the stock's 2012 return to 34.6%. The options pits are reacting positively, as well. TM's 10-day call/put volume ratio of 5.19 on the ISE, CBOE, and PHLX ranks in the 97th percentile of its annual range, signaling speculators have rarely scooped up bullish bets over bearish at a faster pace during the past year. Meanwhile, the Schaeffer's put/call open interest ratio (SOIR) of 0.86 lands in the 9th percentile of its annual range, meaning short-term options players have been more call-heavy just 9% of the time during the past year.

  • UBS is also in rally mode this afternoon, jumping to a 16-month acme of $16.76. The stock has done quite well on the charts recently, outperforming the broader S&P 500 Index (SPX) by 30 percentage points over the past three months, and adding 41.3% since the beginning of the year. Since mid-October, this upswing has been assisted by its 10-day and 20-day trendlines. Checking out the sentiment picture, the analyst crowd could bolster UBS' overall uptrend, by way of price-target hikes; the current consensus 12-month price target of $16.10 represents a fractional discount to the banking firm's new annual high.

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