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by 11/21/2000 3:38 PM
Stocks quoted in this article:
Canadian telecommunications giant, Nortel Networks (NT – 38-5/16), held an analyst meeting in Boston today to reassure investors that the company would be able to meet its estimates of profitability for the present quarter and through next year. NT expects earnings growth to total 40 percent for 2000 and 32 percent for 2001. Apparently, NT's reassuring words comforted nervous shareholders, because the stock reversed from a new low of 31-7/16 on Friday to vault over the 39 mark today. That is a gain of over 24 percent in just two trading days. <
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by 11/21/2000 3:37 PM
Stocks quoted in this article:
Hilton Hotels (HLT – 9-7/8) is seeing some very unusual option activity today. Just before 1:00 p.m., two blocks of 5,000 contracts changed hands on the January 2002 7-1/2 LEAPS put. These blocks went off in rapid succession at 13/16, just above the bid price. Heading into today's activity, open interest at this strike was only 1,066 contracts. This is currently the most-active put option trading today on the AMEX.

Presently, the site of heaviest open interest is the January 2002 10 LEAPS call, which is home to 10,261 contracts. Today's activity will undoubtedly have a profound skew on HLT's put/call ratio data. There is no news to speak of to account for this flurry of activity.
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by 11/21/2000 3:36 PM
Stocks quoted in this article:
Following up on recent "bytes" featuring Adolph Coors (RKY – 75-5/8) and Anheuser-Busch (BUD – 49-5/8), high spirits continue to prevail in the adult beverage market. Deutsche Banc Alex Brown today initiated coverage on the sector, awarding a rating of "buy" to RKY and "strong buy" to BUD because of their consistent earnings and sustainable free cash flow. In response to the positive comments, both beverage makers soared to new 52-week highs, RKY reaching 76-1/4 and BUD 49-7/8.
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by 11/21/2000 3:30 PM
Stocks quoted in this article:
Number-two soft drink manufacturer PepsiCo (PEP – 46-11/16) has tacked on nearly four percent today after the company's board approved a buyback of $4 billion in stock. The buyback will take place gradually over the next three years. The company currently has 1.4 billion shares outstanding.

Today's bounce in the shares has brought the equity within a hair's breadth of its 10-day moving average, which it breached last Wednesday. PEP was able to inch above this trendline at its intraday peak but has now settled just below it. The shares have managed to move back above their 10-week and 20-week moving averages. Last week, the stock closed below these intermediate-term trendlines for the first time since late March.
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by 11/21/2000 3:25 PM
Stocks quoted in this article:
Internet titan Yahoo! (YHOO – 42-1/2) is feeling more like the Titanic today, as it has sunk to levels not seen since mid-November 1998. Catalyzing the equity's 13-percent drop today was a morning report from brokerage house Morgan Stanley Dean Witter. The firm noted that YHOO has a 30-percent chance of missing earnings estimates, due to a slow-down in Internet advertising revenue. The analyst went on to state that YHOO has the potential to fall short of expectations not only next quarter, but in the first two quarters of 2001 as well.

Put activity has accelerated as a result of the equity's latest plunge. Most notable is the volume on deep-in-the-money options in the January series. Around 2,000 contracts have traded on both the January 125 and 130 puts, while 10,500 contracts have swapped hands on both the 185 and 210 puts in the back-month series. The January 145 and 150 puts have both scooped up 1,000 contracts today. Given the outlandish expense of the contracts (83 per contract and above) and the large block sizes, this is probably the work of an institutional investor. Additionally, these blocks are likely related, given the similarity in block sizes. <
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