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Options Radar: General Motors, AT&T Inc., and Intel Corporation

Reviewing notable options activity on General Motors Company, AT&T Inc., and Intel Corporation

by 7/17/2014 1:18 PM
Stocks quoted in this article:

Option traders have taken a shine to automaker General Motors Company (NYSE:GM), as well as blue chips AT&T Inc. (NYSE:T) and Intel Corporation (NASDAQ:INTC). Here's a look at how speculators have been placing their bets on these three names today.

  • General Motors Company (NYSE:GM) is down 0.7% at $37.23, as CEO Mary Barra faces another recall-related firestorm on Capitol Hill. Against this backdrop -- and ahead of the company's turn in the earnings spotlight next Thursday, July 24 -- option players are picking up short-term puts today. Specifically, it looks like traders are buying to open the equity's weekly 8/1 36.50-strike put, which will move into the money if GM backpedals beneath $36.50 by the close on Friday, Aug. 1, when the options expire. While the security's 30-day at-the-money (ATM) implied volatility (IV) has edged 3.1% higher to 22.6% today, GM's short-term options are still relatively inexpensive. The stock's Schaeffer's Volatility Index (SVI) of 22% stands higher than just 26% of all other readings of the past year.

  • AT&T Inc. (NYSE:T) will also report earnings next week -- after the close on Wednesday, July 23, to be exact. Option traders are once again favoring T calls, which are flying off the shelves at nearly twice the typical intraday rate. Digging deeper, speculators are buying to open the weekly 7/25 36.50-strike call, which is the most active option by a landslide. The buyers may be gambling on another earnings win for T, which has matched or surpassed the Street's bottom-line estimates in six of the past eight quarters. At last check, T is lower along with the broader equities market, down 0.5% at $36.26.

  • Finally, Intel Corporation (NASDAQ:INTC) is taking a breather from its post-earnings quest for record highs, down 1.8% at $34.02. INTC's short-term options are in high demand, as the stock's 30-day ATM IV has surged 7% to 18%. Overall options volume is running at three times the intraday norm, though calls have outpaced puts by a margin of more than 2-to-1. Short-term bulls are circling the July 34.50 call, buying the options to open amid hopes for INTC to climb back atop the strike by tomorrow's close, when front-month options expire. Slightly longer-term bulls are buying to open the September 36 call to gamble on even higher highs for the Dow component over the next couple of months.

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