Stocks quoted in this article:
Online auctioneer eBay (EBAY – 38-7/16) is rising in late-morning trading today after it was reported that the firm settled its lawsuit with competitor Bidder's Edge, which had been featuring EBAY merchandise on its site. Bidder's Edge will stop this process and will also pay EBAY an undisclosed sum. In unrelated news, it hit the wires shortly after the opening bell that EBAY has established a software agreement with Rational Software (RATL – 32-1/2).
One of only a handful of Internet names to actually report profitable earnings, EBAY has managed to avoid single-digit territory, although it does remain almost 70 percent off its all-time high reached last March. The stock continues to trend below all of its significant moving-average trendlines.
On the options front, EBAY faces minor out-of-the-money call open interest at the 45 strike in both the March and April series. On the put side, the March 40 and 45 strikes are both home to heavy in-the-money put open interest, with 5,788 and 6,957 open contracts, respectively. Schaeffer's put/call open interest ratio (SOIR) for EBAY currently stands at 1.04, its highest reading over the past 12 months. This indicates a large degree of pessimism from the speculative crowd.