Calls Popular as Skyworks Solutions, Inc. (SWKS) Bounces Back

Skyworks Solutions Inc (SWKS) traders are buying April calls

by Griffin Kruse

Published on Mar 27, 2015 at 1:50 PM
Updated on Apr 20, 2015 at 5:32 PM

Skyworks Solutions Inc (NASDAQ:SWKS) is roughly 4.7% higher at $97.43, erasing some of the losses from a semiconductor swoon earlier this week. Although the shares are still down more than 4% on the week, SWKS has been a technical outperformer, up 165% year-over-year and just off an all-time high of $102.77 on March 23. Some speculators are betting on SWKS to resume its journey to new highs in the next month, as call activity in the options pits is heating up.

In afternoon action, calls are changing hands at three times the average daily rate, and have nearly tripled puts in volume. Among the most active contracts are the April 92 and 96.50 calls, where potential buy-to-open activity has been detected. By purchasing these calls, traders expect the security to continue its push above the respective strikes through the close on Friday, April 17, when the options expire.

However, today's appetite for calls marks a change of pace in the options pits. Before today, puts had been more popular than usual, as SWKS' 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.46 stands in the 89th percentile of its annual range.

On the other hand, the brokerage bunch has been very optimistic on Skyworks Solutions Inc (NASDAQ:SWKS). Out of the 14 analysts covering the stock, 12 rate it a "strong buy" with the remaining two doling out ambivalent "hold" ratings. What's more, SWKS' average 12-month price target of $96.82 sits below current trading levels, implying that more bullish brokerage attention could be on the way.

Daily Chart of SWKS Since March 2014

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