Buzz Stocks: Yahoo! Inc., Microsoft Corporation, and Twitter Inc

Today's stocks to watch in the news are YHOO, MSFT, and TWTR

by Karee Venema

Published on Nov 26, 2014 at 9:28 AM
Updated on Apr 20, 2015 at 5:32 PM

Futures are pointed slightly higher this morning, as traders wait to react to a raft of economic data. Among equities in focus are Internet issue Yahoo! Inc. (NASDAQ:YHOO), software specialist Microsoft Corporation (NASDAQ:MSFT), and microblogging name Twitter Inc (NYSE:TWTR).

  • After announcing last week that it had snagged the rights to be the default search engine to Mozilla away from Google Inc (NASDAQ:GOOGL), YHOO has set its sights on its next target -- Apple Inc. (NASDAQ:AAPL). Currently, AAPL uses GOOGL as the default search engine for its Safari browser, but with the contract set to expire next year, rumors are circling that YHOO -- along with MSFT -- are working together to dethrone the tech titan. In the wake of the reports, YHOO is up 0.1% in pre-market trading, looking to add to its already impressive 27.9% year-to-date gain that has the shares trading at $51.72. Should the stock continue its uptrend, an unwinding of pessimism in the options pits could help propel the shares higher. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Yahoo! Inc.'s 50-day put/call volume ratio of 0.35 ranks in the 90th annual percentile. Simply stated, puts have been bought to open over calls with more rapidity just 10% of the time within the past year.

  • In other MSFT news, the software giant is rumored to be on the hook for a $140 million back-tax bill in China -- the largest on record. Although no confirmation has been given, reports are suggesting that Microsoft Corporation is the only U.S. firm that fits the description offered by the Chinese state media. On the charts, MSFT has had a standout year, rallying nearly 27% to its current perch at $47.47, and tagging a fresh 14-year peak of $50.04 earlier this month. In spite of this technical tenacity, the majority of analysts covering the shares maintain a "hold" or worse suggestion, and the consensus 12-month price target of $49.10 stands at a slim 3.4% premium to present trading levels. Should these skeptics follow in the footsteps of option traders, who have recently begun to capitulate to the equity's momentum, a fresh wave of buying power could ensue.

  • Is TWTR ready to partner up with Justin Bieber? Speculation is swirling that the company is in takeover talks with self-portrait app Shots -- which is partially owned by the pop star -- but the reports could not confirm if this is the firm TWTR's chief financial officer, Anthony Noto, was referencing in Monday's accidental tweet. Technically speaking, TWTR has had a rough go of things, with the shares off 37.5% year-to-date to $39.76. More recently, the stock has been pressured lower by its 20-day moving average -- currently located at $40.61 -- since early October. Option traders have kept the faith, though, as evidenced by the equity's 10-day ISE/CBOE/PHLX call/put volume ratio of 3.05, which ranks higher than 93% of similar readings taken in the past year. Echoing this is Twitter Inc's Schaeffer's put/call open interest ratio (SOIR) of 0.62, which ranks in the 26th percentile of its annual range. In other words, short-term speculators are more call-skewed than usual.

A Schaeffer's exclusive!

The Expert's Guide

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


 
 

Partnercenter


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


Look Who's Going Bankrupt Next in America
Porter Stansberry is making a concerning prediction.
First Week in April Provides More Coronavirus-Related Volatility
A slew of coronavirus-related news sent markets on another weekly roller coaster ride
Netflix Stock Heading into Historically Bullish Quarter
NFLX's 10-day moving average has stepped up as support lately
The Latest Investor's Guide to Precious Metals
Learn how to protect savings and maximize returns by investing in precious metals.