Schaeffer's Trading Floor Blog
Stocks quoted in this article:

The major indexes are resting comfortably in the green today, as investors applaud upbeat news from across the pond, as well as some promising domestic data regarding jobless claims and durable goods. Meanwhile, a number of securities followed suit to touch new annual highs. At last check, the New York Stock Exchange (NYSE) shows 123 stocks at new peaks, while the Nasdaq has 35 at fresh highs. Among the equities tagging 12-month highs in today's trading are The Gap Inc. (NYSE:GPS - 29.51), The Cheesecake Factory Incorporated (NASDAQ:CAKE - 33.12), and Watson Pharmaceuticals, Inc. (NYSE:WPI - 77.51).

  • Although GPS has pared its early morning gains, the stock is still modestly higher today, touching a new high of $29.94. The spike came after Moody's said it expects a 2% - 3% rise in third-quarter sales for apparel retailers -- and noted that GPS is one of the stores most likely to benefit from the back-to-school shopping season. The stock currently boasts a year-to-date gain of more than 59%, which might explain the heavy preference for calls over puts. The equity's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio sits at 32.01, which is just five percentage points shy of a yearly peak. In other words, traders have been picking up calls over puts at an almost annual-high pace.

  • The shares of CAKE have rallied about 9% to reach a new peak of $33.63, thanks to a better-than-expected second-quarter earnings report and a newly initiated quarterly dividend. This surge has led the restaurateur to a year-to-date gain of about 13%, as well as a price-target hike to $37 from $33 at RBC earlier in the session. However, pessimism still abounds, as the equity boasts only eight "buy" or better ratings, compared to 14 tepid "holds" and one "strong sell" suggestion. What's more, short interest makes up more than 15% of CAKE's float. It would take over 13 days to cover these bearish bets, at the security's average pace of trading pointing to plenty of sideline cash to fuel additional gains.

  • Also in the earnings spotlight is WPI, which, despite posting a second-quarter loss, still managed to trump Wall Street's projections. This news has ushered the stock to a new high of $81, and extended its year-to-date climb to roughly 28%. Even so, the pharmaceutical concern has been a bearish target for near-term options players, as evidenced by its Schaeffer's put/call open interest ratio (SOIR) of 1.09 -- indicating that puts outpace calls among the front three-months' series of options. In fact, this ratio stands in the 95th annual percentile, meaning that short-term traders have rarely been more put-heavy toward the equity during the past year.
Keep reading to see what was on today's new lows list.

permanent link
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT

Partner Center

© 2014 Schaeffer's Investment Research, Inc. 5151 Pfeiffer Road, Suite 250, Cincinnati, Ohio 45242 Phone: (800) 448-2080 FAX: (513) 589-3810 Int'l Callers: (513) 589-3800 Email: service@sir-inc.com

All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.

Market Data provided by QuoteMedia.com | Data delayed 15-20 minutes unless otherwise indicated.