Most Active Weekly Options: BlackBerry Limited, Netflix, Inc., and Twitter, Inc.

Weekly options traders have targeted BlackBerry Ltd (BBRY), Netflix, Inc. (NFLX), and Twitter Inc (TWTR)

Apr 6, 2015 at 12:13 PM
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The 20 stocks listed in the table below have attracted the highest total weekly options volume during the past 10 trading days, according to data collected by Schaeffer's Senior Quantitative Analyst Rocky White. A few names of notable interest are Canadian wireless concern BlackBerry Ltd (NASDAQ:BBRY), streaming entertainment specialist Netflix, Inc. (NASDAQ:NFLX), and social media stock Twitter Inc (NYSE:TWTR).

Most Active Weekly Options

Starting with BBRY, options traders have adopted a skeptical stance on the smartphone stock. During the past 10 sessions, the shares have garnered a put/call volume ratio of 0.90 across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio outranks 98% of other such readings taken over the past year, as traders on these three exchanges have shown a stronger preference for bearish bets over bullish only 2% of the time.

Elsewhere, short sellers have a sizable stake in BlackBerry Ltd. Nearly 20% of the equity's float is sold short, representing 8.6 times BBRY's average daily trading volume. And analysts are similarly downbeat, with the stock sporting 84% "hold" or "sell" ratings.

On the charts, BBRY has gained 18.7% in the last 52 weeks, though the shares have shed more than 15% amid the choppy market action of 2015. In today's trading, the stock is bouncing off the low end of its familiar trading range between $9 and $12, up 3.2% at $9.33.

As for NFLX, the stock has become quite popular with call players lately. The security's 10-day ISE/CBOE/PHLX call/put volume ratio of 1.21 arrives in the 89th percentile of its annual range, indicating a stronger-than-usual skew toward bullishly oriented options.

However, with Netflix, Inc. set to report its first-quarter earnings after the market closes on Wednesday, April 15, short-term options on the stock are pricing in particularly lofty volatility expectations. Specifically, Schaeffer's Volatility Index (SVI) for NFLX stands at 63%, which ranks higher than 100% of other such readings from the last 52 weeks.

NFLX does have a history of making dramatic post-earnings moves, which is why options traders are paying relatively hefty premiums for front-month bets right now. In its last eight earnings reports, the stock's single-day price swings have ranged from a gain of 24.4% in April 2013 to a loss of 19.4% last October. The "tamest" post-earnings move over this time frame was a loss of 4.5% in July 2013.

From a broader perspective, NFLX is up more than 22% in 2015 to trade at $417.05. The stock is testing support near the site of late January's earnings-related bull gap, which roughly coincides with its rising 80-day moving average.

NFLX since October 2014 with 80-Day Moving Average

Bullish options players have also shown an interest in TWTR, with calls bought to open more than tripling puts over the past couple of weeks. The stock's 10-day ISE/CBOE/PHLX call/put volume ratio of 3.05 registers in the 78th annual percentile, confirming that recent option activity is slanted firmly toward the optimistic end of the spectrum.

There's still room for sentiment to improve on Twitter Inc, though. The stock's Schaeffer's put/call open interest ratio (SOIR) of 0.81 ranks in the skeptically slanted 83rd annual percentile -- which means short-term players have been more put-heavy on the stock only 17% of the time during the last year. Elsewhere, 12 out of 27 analysts call TWTR a "hold" or "sell."

With shares of the microblogging platform boasting a year-to-date gain of nearly 41%, at $50.53, TWTR could easily benefit from a capitulation among some of the weaker bearish hands. Meanwhile, those looking to bet on additional upside for TWTR can do so at a relative bargain right now. The security's SVI of 33% ranks lower than every other comparable reading from the last 12 months, pointing to historically low option premiums.

 

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