Buzz Stocks: Achillion Pharma, Qualcomm, Motorola

Today's stocks to watch in the news include Achillion Pharmaceuticals, Inc. (ACHN), QUALCOMM, Inc. (QCOM), and Motorola Solutions Inc (MSI)

Feb 9, 2015 at 9:28 AM
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Futures are signaling a lower open, as traders cast a concerned eye overseas. Meanwhile, among specific stocks to watch are drugmaker Achillion Pharmaceuticals, Inc. (NASDAQ:ACHN), as well as communications concerns QUALCOMM, Inc. (NASDAQ:QCOM) and Motorola Solutions Inc (NYSE:MSI).

  • ACHN is up 12.2% in electronic trading, following news the company's experimental hepatitis C drug -- ACH-3102 -- eliminated signs of the virus in six weeks, when combined with Gilead Sciences, Inc.'s (NASDAQ:GILD) Sovaldi during a clinical trial. This represents the shortest time frame and highest positive response rate of any similar two-drug treatment to date. On the charts, ACHN has stumbled since hitting its year-to-date high of $16.54 on Jan. 26, off 34.6% to trade at $10.82. Meanwhile, in the options pits, short-term speculators have shown a distinct preference for calls over puts, as evidenced by Achillion Pharmaceuticals, Inc.'s Schaeffer's put/call open interest ratio (SOIR) of 0.40, which ranks in the 18th annual percentile.

  • QCOM is 2.6% higher ahead of the bell, amid reports the firm is close to resolving a 14-month antitrust probe with China -- which could result in the chipmaker paying a record-breaking $1 billion fine. Technically speaking, it's been a slow start to the year for QCOM, which is down 10.7% at $66.35. Against this backdrop, options traders -- and analysts -- have been upping the bearish ante in recent weeks. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), QUALCOMM, Inc.'s 10-day put/call volume ratio of 0.66 ranks in the 79th percentile of its annual range. Simply stated, puts have been bought to open over calls at a faster-than-usual clip of late.

  • MSI is poised to pop 8% out of the gate on reports the firm could put itself up for sale. The list of potential suitors is lengthy, and includes General Dynamics Corporation (NYSE:GD), Honeywell International Inc. (NYSE:HON), and Raytheon Company (NYSE:RTN). For most of the past few months, MSI has been chopping between $61.50 and $68, and closed Friday near the middle of this range, at $64.66. Options traders have been betting on a breakout, though. At the ISE, CBOE, and PHLX, MSI's 50-day call/put volume ratio of 5.35 ranks in the bullishly skewed 72nd annual percentile. Echoing this call-skewed bias is Motorola Solutions Inc's front-month gamma-weighted SOIR of 0.52, which indicates that near-the-money call open interest roughly doubles put open interest in the February-dated series of options.
 

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