Buzz Stocks: AutoNation, LendingClub, Staples, Inc.

Today's stocks to watch in the news include AutoNation, Inc. (AN), LendingClub Corp (LC), and Staples, Inc. (SPLS)

Feb 3, 2015 at 9:21 AM
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U.S. benchmarks are firmly higher ahead of the open, amid continued strength in the energy sector and encouraging headlines out of Greece. In company news, today's stocks to watch include automotive retailer AutoNation, Inc. (NYSE:AN), grassroots investment platform LendingClub Corp (NYSE:LC), and office supplies outlet Staples, Inc. (NASDAQ:SPLS).

  • Following AN's best quarter in nearly a decade, CEO Mike Jackson expressed confidence in the auto industry as a whole. Specifically, Jackson believes manufacturers will post strong January sales today, and noted that they achieved the results without "doing anything extreme that's not sustainable." Meanwhile, shares of AutoNation, Inc. are pointed 5.7% higher ahead of the bell, which would add to their more than 23% year-over-year gain (as of last night's close at $59.34) and put them in all-time-high territory. In terms of sentiment, there's a lot of negativity flowing toward AN on Wall Street. Seven out of nine covering brokerage firms rate the stock a "hold" or "strong sell," and its 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.73 ranks higher than nearly three-quarters of all other readings from the past year. A capitulation among these skeptics could push AN to even higher highs.

  • LC is up 9.2% in electronic trading on news of a partnership with Alibaba Group Holding Ltd (NYSE:BABA). Specifically, LendingClub Corp will help U.S. businesses secure loans worth up to $300,000 to purchase parts from Chinese manufacturers, via the Internet retailer. Technically speaking, LC has struggled since going public in early December -- shedding nearly 22% to trade at $19.26 -- and touched a record low of $18.30 yesterday, pressured lower by its 10-day moving average. As such, short interest levels have exploded over the last two reporting periods -- to 8.98 million shares sold short, from just 0.40 million in mid-January. At LC's typical daily trading levels, though, it would take less than three sessions to buy back these bearish bets.

  • According to reports, SPLS and Office Depot Inc (NASDAQ:ODP) are in advanced merger talks -- underscoring earlier rumors. However, a potential marriage between the two could come under close scrutiny from antitrust regulators. On the charts, Staples, Inc. has been locked in a long-term uptrend, adding nearly 33% year-over-year to land at $17.14. Ahead of the bell, the shares are sitting 12% higher, potentially setting the stage for a fresh multi-year high out of the gate. Meanwhile, traders at the ISE, CBOE, and PHLX have been jumping on SPLS' bullish bandwagon, per its 10-day call/put volume ratio of 24.78 -- which is just 7 percentage points shy of an annual peak.
 

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