Stocks On the Move: T-Mobile US Inc, Microchip Technology Inc., and Peregrine Pharmaceuticals

TMUS, MCHP, and PPHM are moving sharply in Wednesday's trading

Oct 15, 2014 at 12:31 PM
facebook twitter linkedin


U.S. stocks are decidedly lower this afternoon, as traders digest a raft of dismal economic data and mounting concerns about Ebola. Among the names making significant moves are telecom concern T-Mobile US Inc (NYSE:TMUS), semiconductor issue Microchip Technology Inc. (NASDAQ:MCHP), and drugmaker Peregrine Pharmaceuticals (NASDAQ:PPHM). Here's a quick look at how TMUS, MCHP, and PPHM are faring on the charts today.

  • TMUS is down 4.7% at $25.16, and earlier tagged a new annual low of $24.50, a day after France's Iliad scrapped its bid for the U.S. carrier. TMUS has underperformed the broader S&P 500 Index (SPX) by nearly 12 percentage points during the past three months, and its 14-day Relative Strength Index (RSI) now sits at 28 -- in oversold territory. Against this backdrop, short-term options players have rarely been more put-biased during the past year, as the stock's Schaeffer's put/call open interest ratio (SOIR) of 0.98 sits just 2 percentage points from a 12-month peak. On the flip side, analysts remain optimistic toward T-Mobile US Inc, as 12 out of 15 brokerage firms have doled out "buy" or better endorsements.

  • MCHP also touched a new low, dropping to $37.44 after rival QUALCOMM, Inc. (NASDAQ:QCOM) dashed its dream of buying CSR Plc. Microchip Technology Inc. shares have surrendered nearly 20% so far this month, after last week gapping lower on an industry warning, and were last seen 1.7% lower at $37.57. The security has underperformed the SPX by more than 17 percentage points during the past 60 sessions, translating into a 14-day RSI of 18 for MCHP. However, not everyone on Wall Street is ruing the stock's fall from grace. Short interest accounts for 11.8% of the shares' total available float, representing nearly 17 sessions' worth of pent-up buying demand, at MCHP's average pace of trading.

  • PPHM -- along with other Ebola-related stocks -- is bucking the trend lower, up 14.3% at $1.60. The company -- which will host its annual shareholder meeting tomorrow -- this morning said it will test its experimental Ebola antibody, and traders are waxing optimistic in light of another confirmed case in Dallas. On a year-to-date basis, Peregrine Pharmaceuticals shares have added more than 15%, yet option buyers have been bracing for the worst. On the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 10-day put/call volume ratio of 0.31 stands higher than 99% of all other readings from the past year. In other words, options traders have bought to open PPHM puts over calls at a near-annual-high clip during the past two weeks.
 

Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

 
Schaeffer's Daily Bulletin Offer
 


 


 
Special Offers from Schaeffer's Trading Partners