Buzz Stocks: AK Steel, Oracle, and The Pantry

Today's stocks to watch in the news include AKS, ORCL, and PTRY

Dec 18, 2014 at 9:04 AM
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The major market indexes appear ready to rally, adding to yesterday's Fed-induced surge. In company news, today's stocks to watch include metal manufacturer AK Steel Holding Corporation (NYSE:AKS), enterprise software giant Oracle Corporation (NYSE:ORCL), and convenience store chain The Pantry Inc (NASDAQ:PTRY).

  • AKS anticipates current-quarter shipments will soar to 2 million tons -- a 37% increase over the prior three-month period -- sending the shares more than 8% higher ahead of the bell. The firm also expects to benefit from falling metal and energy prices. Yesterday, AK Steel Holding Corporation rallied 6.1% to close at $5.56, but remains 32.2% lower on a year-to-date basis. Option traders have responded by buying to open puts over calls at a faster-than-usual pace, per data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). Specifically, AKS' 10-day put/call volume ratio across these three exchanges is 0.29, near the top quartile of its annual range.

  • ORCL reported slightly better-than-expected per-share earnings for the fiscal second quarter. Sales increased 3% year-over-year, as well, powered by $7.3 billion in software and cloud revenue. Elsewhere, the brokerage crowd reacted positively to the results, as no fewer than 10 firms raised their price targets on Oracle Corporation, with D.A. Davidson, Canaccord Genuity, and Barclays all eyeing a move up to $50 -- in uncharted territory, representing the boldest forecast of the bunch. These price-target hikes are well-deserved, considering the shares have advanced 19% in the last year to perch at $41.16, just a chip-shot away from their consensus 12-month price target of $43.68. On a related note, a slight majority of analysts are bullish toward ORCL, with 14 firms handing out "buy" or better ratings, versus 11 "hold" or worse opinions. Returning to the charts, the stock is pointed 5.8% higher in electronic trading.

  • Finally, PTRY is being purchased for just over $860 million by Canadian convenience store chain Alimentation Couche-Tard Inc, owner of Circle K. The deal works out to roughly $36.75 per share, or a 3.5% premium to The Pantry's Wednesday close at $35.52. Longer term, the stock has been a beast, more than doubling in value this year, and touching a seven-year high of $36.71 yesterday on then-unconfirmed buyout whispers. What's more, the equity is sitting another 2.2% above breakeven this morning. Accordingly, options traders have been upping the bullish ante, based on PTRY's 50-day ISE/CBOE/PHLX call/put volume ratio of 4.95 -- in the 74th annual percentile.
 

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