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QUALCOMM, Inc. (NASDAQ:QCOM) options buyers have targeted puts over calls during the past two weeks, according to the stock's International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) 10-day put/call volume ratio of 1.08. This ratio ranks higher than all other readings taken over the last year, indicating puts are being picked up over calls at an annual-high clip.
Still, calls remain the options of choice among QCOM's short-term traders. In fact, calls nearly double puts among options expiring in three months or less, according to the stock's Schaeffer's put/call open interest ratio (SOIR) of 0.56. This ratio ranks in the 14th percentile of its annual range, demonstrating short-term traders are more call-heavy than usual right now.
Following this particular trend, QCOM's weekly 8/23 67.50-strike call has received the most attention so far today. Roughly one-third of the overall intraday call volume has changed hands at this strike for a volume-weighted average price (VWAP) of $0.48. The majority of these contracts went off at the ask price, implied volatility has ticked higher, and volume exceeds current open interest, collectively pointing to buy-to-open activity.
By purchasing these near-the-money options, today's call buyers anticipate QCOM -- docked at $66.95 -- will surpass the breakeven price of $67.98 (strike price plus the VWAP) by this Friday's close, when the options expire. This represents territory last reached in mid-April.
Given that QCOM's Schaeffer's Volatility Index (SVI) of 20% ranks higher than just 16% of other such annual readings, the stock's short-term options are cheaper than usual right now, relatively speaking. Therefore, should QCOM fail to finish north of the 67.50 strike upon expiration, today's call buyers can rest easy knowing the initial premium paid -- which is the most they stand to lose -- was fairly inexpensive.
On the technical front, QUALCOMM, Inc. (NASDAQ:QCOM) sports a modest year-to-date gain of 8.2%. In the past 20 trading days alone, however, the stock has tacked on 7.6%, and has outperformed the broader S&P 500 Index (SPX) by 11 percentage points. With that being said, from the 28 analysts weighing in, QCOM has received 24 "buy" or better endorsements, compared to just four "holds" and not a single "sell" or worse suggestion. Likewise, the stock's consensus 12-month price target of $74.01 stands in territory not encountered by QCOM since April 2000.