Buzz Stocks: American Realty Capital Properties Inc, Cal-Maine Foods Inc, and Novo Nordisk A/S (ADR)

Today's stocks to watch in the news include ARCP, CALM and NVO

by Karee Venema

Published on Dec 24, 2014 at 9:19 AM
Updated on Apr 20, 2015 at 5:32 PM

Futures are pointed higher, as markets look to finish the holiday-shortened session on a high note. Meanwhile, among specific equities in focus are real estate investment trust American Realty Capital Properties Inc (NASDAQ:ARCP), egg producer Cal-Maine Foods Inc (NASDAQ:CALM), and healthcare concern Novo Nordisk A/S (ADR) (NYSE:NVO).

  • ARCP is down nearly 3% in electronic trading, amid more fallout from its accounting irregularities. Specifically, the firm said it reached a waiver agreement with lenders and suspended its dividend payment as it tries to get its fiscal house in order. Since the company first uncovered the incorrect financial statements in late October, shares of American Realty Capital Properties Inc have plunged 32.7% to trade at $8.33, and option traders have been rolling the dice on more downside. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the security's 10-day put/call volume ratio of 1.11 ranks just 6 percentage points from an annual bearish peak.

  • CALM is bracing for a 10% plunge out of the gate, after the company's fiscal second-quarter profit fell short of analysts' estimates. Overall, it's been a good year for the stock, which is up nearly 47% to $44.18. What's more, CALM found a foothold atop its 160-day moving average -- currently located at $39.59 -- earlier this month. In spite of the equity's longer-term trajectory, short sellers raised the stakes ahead of last night's scheduled announcement. Short interest nearly tripled over the last two reporting periods, and now accounts for 14% of the security's available float. Additionally, it would take more than 11 sessions to cover these shorted shares, at Cal-Maine Foods Inc's average daily pace of trading.

  • It was a rough day for pharmaceutical firms on Tuesday, and NVO was no exception, shedding 3.2% to close at $42.72 -- its lowest settlement since June 2. Today, however, the shares are poised to bounce back, after the Food and Drug Administration (FDA) approved the company's diabetes drug, liraglutide, to treat obesity. Year-to-date, the shares are up nearly 16%, and in the options pits, calls have been popular in recent months. At the ISE, CBOE, and PHLX, NVO's 50-day call/put volume ratio of 4.10 ranks higher than 73% of similar readings taken in the past year. Echoing this call-skewed bias is the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.47, which sits lower than all other comparable readings taken in the past 52 weeks. Simply stated, short-term speculators are more call-heavy now on Novo Nordisk A/S (ADR) than they've been at any other point during the last year.

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