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Option Clips: VeriSign, Inc., InvenSense, and Alcatel Lucent SA (ADR)

Reviewing notable options activity on VeriSign, Inc., InvenSense Inc, and Alcatel Lucent SA (ADR)

by 3/17/2014 1:59 PM
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Two equities generating buzz on StockTwits today are Internet issue VeriSign, Inc. (NASDAQ:VRSN) and motion-sensor maker InvenSense Inc (NYSE:INVN). Meanwhile, France-based tech concern Alcatel Lucent SA (ADR) (NYSE:ALU) has also been active in the options pits. Here's a look at how traders have been aligning their speculative bets today.

  • VeriSign, Inc. (NASDAQ:VRSN) is the biggest laggard of the S&P 500 Index (SPX), down 7.1% at $50.94, and earlier hitting a year-to-date low for the shares at $48.55. Pressuring the stock into the red was a downgrade to "market perform" from "outperform" at Cowen and Company, which cited the U.S. government's newly announced plans to relinquish domain-name oversight to an undisclosed entity by September 2015. With VRSN now on the short-sale restricted list, bears are turning to the options pits. So far, the stock has seen close to 7,300 puts cross the tape -- 52 times its average intraday put volume. Digging deeper, speculators seem to be buying to open the March 49 and 50 puts, in order to gamble on additional downside for VRSN this week.

  • InvenSense Inc (NYSE:INVN) is 6% higher at $22.65, after Baird lifted its price target by $5 to $28 and reiterated its "outperform" endorsement. The security has seen roughly 17,000 calls cross the tape today -- three times the norm. For comparison, fewer than 800 INVN puts have changed hands. Almost half of the call action has transpired at the March 22.50 strike, where 8,031 contracts traded -- mostly in a sweep of nearly 7,000 contracts that traded near the ask price of $0.45 apiece. The buyer will make money if INVN finishes north of $22.95 (strike plus premium paid) on Friday, when front-month options expire.

  • Finally, Alcatel Lucent SA (ADR) (NYSE:ALU) is following the broader equities market into the black, up 3.1% at $3.96. Overall options volume is running at about six times the average intraday pace, with speculators employing both calls and puts to place neutral-to-bullish bets on the shares. Specifically, "vanilla" option bulls are apparently buying to open the June 4.33 call, which is most popular so far, with close to 7,000 contracts traded. Meanwhile, the International Securities Exchange (ISE) detects some sell-to-open activity at the June 3.83 put, which is No. 2 in volume thus far, with close to 5,900 contracts traded.


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