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Outside of last Thursday's rare spike in call volume, bearish sentiment has been growing in NVIDIA Corporation's (NASDAQ:NVDA) options pits, ahead of the chipmaker's turn in the earnings confessional Thursday night. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), for example, the equity's 10-day put/call volume ratio has moved to 0.65 from its month-ago reading of 0.30. What's more, the current ratio ranks in the 92nd percentile of its annual range, meaning puts have been bought to open over calls with more rapidity just 8% of the time within the past year.
Echoing this developing trend is NVIDIA's Schaeffer's put/call open interest ratio (SOIR). Since July 22 (the day after July options expired), the stock's SOIR has risen to 0.70 from 0.54, as put open interest in the front three-months' series jumped 57%. This ratio ranks higher than 90% of similar readings taken in the past year, pointing to a put-skewed bias in NVDA's short-term options pits.
The skepticism toward NVDA is evident outside of the options arena, as well. Among covering analysts, no fewer than 21 out of 27 maintain a "hold" or worse suggestion toward the stock, and the consensus 12-month price target of $14.75 is just a chip-shot away from the equity's current perch at $14.68. Additionally, a healthy 7.7% of the stock's float is sold short, representing more than eight days' worth of pent-up buying demand.
On the charts, NVIDIA Corporation (NASDAQ:NVDA) has tacked on a formidable 19.4% in 2013. More recently, though, the equity has been churning in the $14-to-$15 range (outside of a brief licensing-related intraday jump to an annual high of $15.48 on June 19) since mid-May.
Fundamentally, the company has matched or exceeded analysts' expectations in each of the last eight quarters. However, while the stock, on average, has tacked on 1.3% in the day following the report, it has shed 2.1% in the week after. For NVDA's fiscal second quarter, Wall Street is calling for a per-share profit of 13 cents, a six-cent decline from the company's year-ago results.