Earnings Preview: First Solar, Inc., Visa Inc., and Exxon Mobil Corporation

Analyzing recent option activity ahead of earnings from First Solar, Inc. (NASDAQ:FSLR), Visa Inc (NYSE:V), and Exxon Mobil Corporation (NYSE:XOM)

by Griffin Kruse

Published on Apr 29, 2015 at 3:18 PM

Among the stocks gearing up to report earnings tomorrow are solar panel maker First Solar, Inc. (NASDAQ:FSLR), as well as blue chips Visa Inc (NYSE:V) and Exxon Mobil Corporation (NYSE:XOM). Below, we'll take the pre-earnings temperature of FSLR, V, and XOM. 
  • The shares of FSLR have rebounded 59% since hitting an annual low of $39.18 on Jan. 20, last seen hovering at $62.30. However, puts have been popular in the options pits, as First Solar, Inc.'s 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.66 is higher than 73% of all similar readings from the past year. On the earnings front, the stock enjoyed a 7% post-earnings gain in late February, and has moved an average of 6.7% in the session immediately following its last four earnings reports. FSLR's near-term straddle, meanwhile, is pricing in a 6.4% swing. Traders are paying relatively fair prices for their near-term bets on the equity, as its 30-day at-the-money implied volatility of 44% stands in the 53rd percentile of its annual range. 
  • On the other hand, the shares of have taken a step back recently. Although the stock notched an all-time high of $69.98 last week -- due in part to a decision by the Chinese government to open their credit market to Visa Inc and competitor MasterCard Inc (NYSE:MA) -- it has since pulled back roughly 4% to $67.29. Heading into today's session, traders have shown a preference for calls over puts, as V's 50-day ISE/CBOE/PHLX call/put volume ratio of 1.63 stands in the 95th percentile of its annual range. Elsewhere, the security has moved an average of 5.4% in the session immediately following its last four earnings reports. After V steps into the earnings limelight tomorrow, the options market expects the equity to move 3.4% by Friday's close, per its near-term straddle. Short-term option players are paying up to place bets, as V's Schaeffer's Volatility Index (SVI) of 28% is the highest similar reading from the past 12 months. 
  • XOM has been in recovery mode, with the shares up 6% from their March 13 two-year low of $82.68 to linger near $87.65. However, the stock is now staring up at potential resistance from its 20-week moving average, which has ushered XOM lower since its late July peak. Sentiment in the options pits has been bullish, as Exxon Mobil Corporation's 10-day ISE/CBOE/PHLX call/put volume ratio of 1.14 is higher than 72% of all equivalent readings from the last year. On the earnings front, XOM has experienced an average post-earnings swing of 2.6% in the session immediately after its last four trips to the earnings confessional. According to the stock's near-term straddle, the options market is pricing in a move of 2.2% this go-around. Speculators are paying relatively attractive prices for their near-term bets on XOM, as its SVI of 20% reads in the 41st percentile of its annual range. 

A Schaeffer's exclusive!

The Expert's Guide

Access your FREE trading earning announcements before it's too late!



NEW! Explore Schaeffer’s Partners' deals and get connected to top online brokerages with deals tailored exclusively for our readers.  Get answers to your questions regarding transfer fees, commission rates, programs and available discounts related to online trading services.

MORE | MARKETstories

The Nevada Discovery That Could Jeopardize Chinese Dominance
Click to continue to advertiser's site.
Billion-Dollar AT&T Loan Boosts Stock
T announced at $5.5 billion term-loan agreement today
SHOP Stock Fails to Shake Off Downgrade
Raymond James downgraded Shopify to "market perform" from "outperform"
The Top Lithium Play of 2020
Click to continue to advertiser's site.