Intel Option Bears M.I.A. Ahead of Earnings

INTC put open interest has rarely been lower in the past year

Managing Editor
Apr 25, 2018 at 1:20 PM
facebook X logo linkedin


Semiconductor giant Intel Corporation (NASDAQ:INTC) is slated to report its first-quarter earnings after the close tomorrow. The stock notched a 17-year high of $54.35 on April 18, before pulling back amid a broader chipmaker sell-off, and today is fractionally lower amid reports of a Justice Department probe into possible violations of Iran sanctions by Huawei (subscription required). INTC shares have been in a long-term trend higher since July, with a pullback earlier this month contained by their 50-day moving average. The blue chip was last seen trading at $51.32.

Daily Chart of INTC with 50MA

Looking at its earnings history, INTC stock has finished higher the day after reporting in four of the past five quarters, including a 10.6% jump following its last report. The stock's average post-earnings daily price move is 4.3%, regardless of direction, looking back two years. This time around, the options market is pricing in a 7% next-day move in either direction, per at-the-money implied volatility data.

Digging deeper, put open interest currently stands at 651,493 contracts, ranking in the low 3rd percentile of its annual range. Call open interest, meanwhile, stands at more than 1 million contracts -- in the 81st percentile of its 12-month range. This indicates that Intel options traders are much more call-heavy than usual ahead of earnings, with bears practically M.I.A.

Echoing that, the stock's Schaeffer's put/call open interest ratio (SOIR) stands at 0.61, and ranks in the lowest percentile of its annual range. This suggests near-term traders have rarely shown a greater preference for INTC calls over puts in the last year.

Intel has handily rewarded premium buyers over the past year. The semiconductor stock currently sports a Schaeffer's Volatility Scorecard (SVS) of 81 out of 100. This means the equity has tended to register bigger price swings than its options premiums have priced in over the past 12 months.
 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI