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by 12/14/2000 12:06 PM
Stocks quoted in this article:
Bed Bath & Beyond (BBBY – 21-5/16) is in the news today after reporting third-quarter earnings last night of 14 cents per share, matching the consensus estimate on Wall Street. Prudential stepped up to bat for the company today, reiterating its "strong buy" rating on the firm and saying it remains confident that the company will achieve earnings estimates for the fourth quarter as well as for fiscal year 2001.

This news has failed to benefit BBBY shares, which are trading slightly in the red around noon. The equity has weathered a recent downtrend but continues to grasp support at its ascending 10-month moving average. This long-term trendline has offered support to the stock since March.
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by 12/14/2000 12:00 PM
Stocks quoted in this article:
Sanmina (SANM – 77-5/32) manufactures electronic components for use in the communications, computer, and medical instrument markets. The stock has been settling gradually lower since late October and is presently hovering around the 72-76 region. This area offered previous support to the shares throughout the first half of June.

Last night after the close, the firm's board announced an impending two-for-one stock split. The split will go into effect on January 8 for shareholders of record by December 18. The shares are reacting well to this news, posting a five-percent gain in late-morning trading.

Options activity is sluggish, as the most-active SANM position trading is the January 75 put, where 266 contracts have crossed the tape. The site of heaviest SANM option activity is the January 2002 LEAPS call, home to 7,276 open contracts.
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by 12/14/2000 11:32 AM
Stocks quoted in this article:
After the close on Wednesday, Verity (VRTY – 22-1/16) reported second-quarter earnings of 23-cents per share, exceeding the Street's collective expectation of 20-cents per share. Although the shares closed off 11/16 for the day, they traded as high as $21 in after-hours activity. This morning, the shares are trading up over 20 percent, just above the technically significant 22 mark. This level provided support during October and November and is close to the descending 10-week moving average. This level could offer resistance, but a clean close above it would be truly constructive for this stock caught in bear mode.

Options traders appear to be extremely optimistic about VRTY and short sellers are not active, as the equity's current short interest ratio stands at 1.61. Yesterday's Schaeffer's put/call open interest ratio (SOIR) for VRTY stood at 0.26. This means that there were just 26 open put contracts for every 100 open call contracts in options with up to three months of life left. What is missing from this empirical glance is the huge open interest at the far out-of-the-money December 35, 40, and 55 call strikes. Many of these positions were added during the stock's consolidation this past summer, before it began declining from the September peak of 47.

Options activity heading into earnings has been muted. Yesterday's activity was concentrated around the 20 strike. The December 20 put had volume of 233 contracts, translating into 156 new positions, while the December 20 call had volume of 500 contracts, translating into 226 new positions. <
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by 12/14/2000 10:47 AM
Stocks quoted in this article:
Last night, officials from America Online (AOL – 48.25 ) and Time Warner (TMX – 46-9/16 ) signed a deal that clears the way for their proposed merger to finally conclude by the end of the year. They committed to open their cable system to Internet competition, including a signed contract with EarthLink (ELNK – 7-15/16) and proposed terms for other competitors. The agreement includes more concessions than the companies originally offered. The Federal Trade Commission should vote today to approve the mega-merger that was originally announced back in January.
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by 12/14/2000 10:10 AM
Stocks quoted in this article:
Now that the presidential election process is finalized, will the much-anticipated "Bush bounce" actually happen today? Maybe not, if European trading and the futures are any indication. Both were generally down in pre-market activity today. Yesterday, the best-performing groups included tobacco (TOB – 285.62) and pharmaceuticals (DRG - 438.1), which are considered "Bush friendly" groups that have been strong for a while. So far this morning, they are trading down slightly. This could be another case of "buy on the rumor, sell on the news."

Here is another interesting note for watchers of the Nasdaq Composite (COMP – 2832.1). A 50-percent correction of the decline from the COMP's November 6 high of 3480 to its November 30 bottom of 2523 is at 3001.50, which coincides with Wednesday's high of 3001.70.
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