Earnings Season Highlights

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A collection of noteworthy post-earnings reactions
Published on Sep 21, 2023 at 12:10 PM
  • Midday Market Check



Published on Sep 21, 2023 at 11:55 AM
  • Quantitative Analysis

Antero Resources Corp (NYSE:AR) stock is down 2.2% at $24.41 at last glance, and carries a 21.2% year-to-date deficit. Traders shouldn't fret just yet, however, as the security is now trading near a trendline with historically bullish implications.

More specifically, AR is trading just one standard deviation away from its 80-day moving average. Per Schaeffer's Senior Quantitative Analyst Rocky White, the security saw four similar signals in the past three years, finishing higher one month later 100% of the time with an average 16.7% gain. A move of similar magnitude would put Antero Resources stock near $28.50, or just below its Jan. 17 annual high of $30.83.

AR Chart September 212023

Attractively priced premiums make now an excellent time to gamble on AR's move higher. In fact, the stock's Schaeffer's Volatility Index (SVI) of 29% ranks in the 13th percentile of its annual range, suggesting options traders are now pricing in low volatility expectations. 

Published on Sep 21, 2023 at 11:00 AM
  • The Week Ahead
Published on Sep 21, 2023 at 10:55 AM
  • Intraday Option Activity
  • Buzz Stocks
KB Home (NYSE:KBH) stock is down 3.9% to trade at $46.20 at last check, despite the company yesterday sharing better-than-expected fiscal third-quarter earnings and revenue. A 41% drop in net income to $149.9 million is hurting the shares instead. Three brokerages also updated their price targets on KBH in response, with Wedbush adjusting from $64 to $55 earlier.

The 160-day moving average is containing today's pullback, which has the stock trading at its lowest level since June. The $52 region has also emerged as a ceiling after KBH's July 20, 16-year high of $55.37. The equity maintains a healthy 45.4% lead for 2023, however.

Options volume is running at nine times the intraday average, with 4,080 puts and 2,911 calls exchanged so far. The November 45-strike put is most popular, with new positions being opened there.

Short-term options traders lean overwhelmingly bearish. This is per KB Home stock's  Schaeffer's put/call open interest ratio (SOIR) of 6.25 that ranks in the top percentile of annual readings.

Published on Sep 21, 2023 at 10:37 AM
  • Buzz Stocks

CrowdStrike Holdings Inc (NASDAQ:CRWD) is on the rise today, following the company's improved margin outlook. No fewer than 11 analysts lifted their price targets as well, with the highest coming from Needham to $215 from $200.

At last glance, CRWD was up 1.3% at $165.98 -- earlier as high as $171.00. The security is firmly above all notable short- and long-term moving averages, with its 20-day trendline lingering below as potential support. Since the start of the year, CrowdStrike stock is up 57.7%. 

Options traders are taking a cue from analysts today as well. So far, 12,000 calls have been exchanged, which is double the amount typically seen at this point, in comparison to 6,792 puts. 

These options are well-priced at the moment, too. CRWD's Schaeffer's Volatility Index (SVI) of 35% ranks in the low 6th percentile of its annual range, meaning options traders are pricing in low volatility expectations. 

Published on Sep 21, 2023 at 10:32 AM
  • Buzz Stocks
Published on Sep 21, 2023 at 9:12 AM
  • Opening View

Stocks are taking a dive before the bell this morning, with futures on both the Dow Jones Industrial Average (DJIA) and Nasdaq Composite (IXIC) down triple digits, while S&P 500 (SPX) futures sit firmly lower as well. Rising bond yields are weighing on Wall Street, with the 10-year Treasury yield and 2-year Treasury yield both hitting their highest levels since 2007 in the wake of the U.S. Federal Reserve's rate decision. Meanwhile, weekly jobless claims came in at a lower-than-expected 201,000. 

Continue reading for more on today's market, including: 

  • Restaurant stock looks ripe for options bears. 
  • 10 facts about 0DTE options from traders. 
  • Plus, two earnings reports to unpack; and a tech stock in focus. 

Futures Sep21

5 Things You Need to Know Today

  1. The Cboe Options Exchange (CBOE) saw 988,946 call and 779,403 put contracts exchanged on Wednesday. The single-session equity put/call ratio rose to 0.79 and the 21-day moving average stayed at 0.66.
  2. FedEx Corp (NYSE:FDX) stock is up 5.3% premarket, after the logistics company's fiscal first-quarter profit beat and raised forecast overshadowed a revenue miss. No fewer than eight analysts lifted their price targets after the event. Since the start of the year, FDX is up 44.6%. 
  3. Darden Restaurants Inc (NYSE:DRI) beat fiscal first-quarter earnings estimates and reiterated its full-year forecast. The restaurant stock is slipping before the bell, though paring earlier premarket losses -- down 0.2% at last glance. The equity is holding on to an 8% year-to-date lead. 
  4. The shares of Skyworks Solutions Inc (NASDQ:SWKS) are down 1.3% in electronic trading, after BNP Paribas Exane downgraded the software name to "neutral" from "outperform," with a price-target cut to $110 from $115. Since the start of the year, the equity is up 5.7%. 
  5. See what economic data is scheduled this week. 


Fed Fatigue Reaches Overseas Markets

Stocks in Asia mirrored stateside futures, following the U.S. Federal Reserve’s decision to leave interest rates unchanged. The central bank did, however, say that it expects another rate hike before the end of the year. The Bank of Japan (BoJ) kicked off its own two-day policy meeting and the Nikkei lost 1.4% Thursday. South Korea’s Kospi led the region’s losses with a 1.8% drop, while Hong Kong’s Hang Seng and China’s Shanghai Composite shed 1.3% and 0.8%, respectively.

A deluge of interest rate updates from European central banks are weighing on markets in the region. Specifically, Turkey, Sweden, Switzerland, Norway, and England all saw their central banks make updates, with the Bank of England (BoE) pausing its hiking cycle after a cooler-than-expected inflation reading. At last glance, London’s FTSE 100 is 0.3% lower, while the France’s CAC 40 is off by 1.5%, and the DAX in Germany is down 1.1%.

Published on Sep 20, 2023 at 2:46 PM
Updated on Sep 20, 2023 at 4:46 PM
  • Options Recommendations

Subscribers to Schaeffer's Weekend Trader options recommendation service received this QSR commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.

Restaurant Brands International Inc (NYSE:QSR) has been failing near the $70 region, a level of resistance since mid-August, and a line of pressure prior to the stock’s post-earnings breakout in May. Both the stock’s 20- and 200-day moving averages are now keeping a lid on gains, an area that coincides with its year-to-date AVWAP level. With an inverted hammer candlestick formation forming on its recent uptrend, we are betting on the mounting technical resistance to trip up QSR going forward.  

QSR Sep15

The $70 and $72.50 levels are home to large call open interest (OI), with very little put OI below to act as support. QSR’s 50-day call/put volume ratio of 2.85 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks higher than 92% of readings from the past year, leaving plenty of room for a pessimistic shift amongst options traders.
Plus, looks like a good time to weigh in on the security's next move with options. The stock is seeing attractively priced premiums at the moment, per its Schaeffer's Volatility Index (SVI) of 16%, which sits in the 7th percentile of its annual range. Furthermore, the security's Schaeffer's Volatility Scorecard (SVS) sits at a relatively high 81 out of 100, meaning QSR has exceeded option traders' volatility expectations during the past year. 
Our recommended put option has a leverage ratio of 14.3 and will double on a 6.8% drop in the underlying shares.

Published on Sep 20, 2023 at 4:26 PM
  • Market Recap

The Federal Reserve kept interest rates unchanged this month, but suggested it expects another hike before the end of the year and anticipates fewer-than-expected cuts next year. In a statement, Fed Chair Jerome Powell said inflation "has moderated somewhat," but acknowledged that that in the fight to get inflation down to 2% there's "a long way to go."

In response, the Dow fell 77 points, while the S&P 500 and Nasdaq also closed in the red. Elsewhere, the 2-year Treasury yield hit its highest mark since 2006, while the VIX enjoyed a fourth-straight gain.

Continue reading for more on today's market, including:

  • Don't buy into this travel stock's hype just yet.
  • Software stock popped on loan buzz.
  • Plus, oil spike implications; DG's downgrade; and what happened with Pinterest.

closing summary sep20

nyse nasdaq sep20

5 Things to Know Today

  1. Prominent authors, including John Grisham, George R.R. Martin, and Jodi Picault, are suing OpenAi over alleged copyright infringement. (CNBC)
  2. More than 58,000 pounds of ground-beef products are being recalled, in relation to a possible E. coli contamination. (MarketWatch)
  3. What recent oil spikes mean for Wall Street.
  4. J.P. Morgan Securities downgraded Dollar General stock.
  5. Pinterest provided impressive revenue figures.

Earnings Sep20

UVOL Sep20

Gold Futures Mark 5th Straight Win

Oil futures closed up shop lower Wednesday, marking a second-straight loss as prices retreat from their 2023 highs. For the session, crude for October delivery lost 92 cents, or 1%, to settle at $90.28 per barrel.

Gold futures notched a fifth-straight win after the Fed's interest rate decision. This marks bullion's longest winning streak since January. December-dated gold gained $13.40, or 0.7%, to close at $1,967.10 an ounce on the day.

Published on Sep 20, 2023 at 2:19 PM
  • Quantitative Analysis

Shares of Tripadvisor Inc (NASDAQ:TRIP) are 0.4% lower at $16.21 this afternoon, on track to snap a four-day win streak. The stock is now up 8.1% in September, though its recent pop has it trading near a trendline with historically bearish implications. 

Specifically, TRIP recently came within one standard deviation of its 120-day moving average, after a lengthy stretch below the trendline. Per Schaeffer's Senior Quantitative Analyst Rocky White, there were five similar pullbacks over the past couple years. The equity averaged a one-month loss of 7.5% after four of those signals. From where the stock currently sits, a similar move would put Tripadvisor back around $15.15. 

TRIP Chart September 202023

Options traders emphasized calls over the last two weeks, and an unwinding of this optimism is likely to pressure the equity. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), TRIP's 10-day call/put volume ratio of 3.16 ranks in the 77th percentile of annual readings, which indicates a preference for bullish bets compared to the last 12 months.

Options look like the ideal avenue to pursue for those looking to speculate on TripAdvisor stock, as it sports relatively cheap premium. This is per the equity's Schaeffer's Volatility Index (SVI) of 34%, which stands higher than just 3% of readings from the past year.

Published on Sep 20, 2023 at 12:01 PM
  • Midday Market Check



Published on Sep 20, 2023 at 11:00 AM
  • Buzz Stocks

Western Digital Corp (NASDAQ:WDC) hit a fresh 52-week high today, after Bloomberg reported Kioxia Holdings' lenders are planning to refinance 2 trillion yen ($13.5 billion) in loans to support a potential merger with the former's flash memory business. In addition, Exane BNP Paribas upgraded the shares to "outperform" from "neutral." 

At last glance, WDC was up 6.2% at $46.66, earlier hitting a peak of $46.89. The stock has been chopping higher, with help from its 80-day moving average. Since the start of the year, the equity is up 47.3%. 

Options bulls are chiming in on the news. So far, 15,000 calls have been exchanged -- eight times what's typically seen at this point -- in comparison to 1,821 puts. The weekly 10/13 47-strike call is the most popular, with new positions being opened there. 

These options are well-priced at the moment, too. WDC's Schaeffer's Volatility Index (SVI) of 33% sits in the low 9th percentile of its annual range, meaning options traders are pricing in low volatility expectations. 

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