3 Apple Suppliers Flying Up the Charts

Cirrus Logic, Inc. (NASDAQ:CRUS), Skyworks Solutions Inc (NASDAQ:SWKS), and Avago Technologies Ltd (NASDAQ:AVGO) are benefiting from Apple Inc.'s (NASDAQ:AAPL) standout earnings report

Oct 28, 2015 at 11:48 AM
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Being an Apple Inc. (NASDAQ:AAPL) supplier can be a two-edged sword, with shares of these companies often tracking the moves of their blue-chip counterpart -- for better or worse. Today, with AAPL breaking out on earnings and a round of bullish brokerage notes, supplier stocks are benefiting. Here's a closer look at three such names -- Cirrus Logic, Inc. (NASDAQ:CRUS), Skyworks Solutions Inc (NASDAQ:SWKS), and Avago Technologies Ltd (NASDAQ:AVGO).

CRUS was last seen 5.5% higher at $30.97, bringing its year-to-date lead to over 31%. Traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) may not be happy about the upward move. During the past 10 sessions, the equity has amassed a put/call volume ratio of 0.68 -- in the bearish 70th percentile of its annual range. Likewise, short sellers may be feeling the heat, as 9.2% of Cirrus Logic, Inc.'s float is sold short. Should either group of skeptics begin to throw in the towel, the shares could catch a rare fourth-quarter tailwind -- especially if the company can top expectations during tonight's trip to the earnings confessional.

Option traders have also been extremely bearish toward SWKS, based on its 10-day ISE/CBOE/PHLX put/call volume ratio of 0.97, which is just 8 percentage points from an annual high. Unfortunately for them, the stock is up 3.1% at $78.70 -- though its intraday momentum seems to have petered out just below its 10-day moving average once again. While the options crowd has been betting against Skyworks Solutions Inc, the brokerage bunch has kept the faith. An overwhelming 94% of covering analysts have doled out "buy" or better ratings on the equity, with not a single "sell" recommendation to be found.

Finally, AVGO has advanced nearly 4.7% at midday to trade at $127.16, and over 26% on the year. This is bad news for put buyers and short sellers alike. For one, Avago Technologies Ltd's 10-day put/call volume ratio of 1.64 outranks 97% of comparable readings from the last 12 months. For another, over 8% of the stock's float is sold short, representing one week's worth of pent-up buying power, at typical trading volumes. Long story short, the shares could benefit from an unwinding of negativity on Wall Street.


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