Earnings Preview: Intel, Johnson & Johnson, JPMorgan Chase

Analyzing recent option activity on Intel Corporation (INTC), Johnson & Johnson (JNJ), and JPMorgan Chase & Co. (JPM)

by Griffin Kruse

Published on Apr 13, 2015 at 12:40 PM
Updated on Jun 29, 2020 at 11:14 AM

Among the stocks gearing up to report earnings tomorrow are tech titan Intel Corporation (NASDAQ:INTC), pharmaceutical giant Johnson & Johnson (NYSE:JNJ), and blue-chip financial firm JPMorgan Chase & Co. (NYSE:JPM). Below, we'll gauge the pre-earnings temperature of INTC, JNJ, and JPM.

  • The shares of INTC are up about 8.8% from their March 26 year-to-date low of $29.31 to hover near $31.90, with the stock staring up at resistance from the $32 level and its descending 40-day moving average. In the options pits, traders have been picking up Intel Corporation calls over puts lately. Drilling down, over the past 10 days at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), INTC has racked up a call/put volume ratio of 2.51, which stands higher than 83% of all similar readings from the past year. In the session immediately following its last four earnings reports, INTC has been mixed, with returns ranging from a loss of 2.7% in October to a 9.3% pop last July. Short-term options buyers are paying middling prices to bet on the equity, as INTC's Schaeffer's Volatility Index (SVI) of 27% is in the 45th percentile of its annual range.

  • JNJ has been sliding, with the shares down 2.9% year-to-date to hit $101.56 -- and trading just below their 80-day moving average. Accordingly, puts have been popular in the options pits, as Johnson & Johnson's 10-day ISE/CBOE/PHLX put/call volume ratio of 1.52 ranks in the 95th percentile of all equivalent readings taken over the past 12 months. Meanwhile, in the session immediately following each of its last three earnings reports, JNJ has lost more than 2%, with the equity failing to notch a positive post-earnings session since April of last year. Traders are paying historically attractive prices for their near-term bets on JNJ, as its SVI of 15% arrives in the 37th percentile of its annual range.

  • The shares of JPM have been choppy in 2015, down 0.6% year-to-date to hit $62.20. However, traders have favored calls over puts ahead of JPMorgan Chase & Co.'s trip to the earnings confessional tomorrow. Specifically, JPM's 10-day ISE/CBOE/PHLX call/put volume ratio of 1.64 stands in the 74th percentile of its annual range. Looking elsewhere, in the session immediately following its last four earnings reports, JPM has lost an average of 1% -- including a 3.5% dip in January. Near-term options are available for relatively modest prices, as JPM's SVI of 18% is higher than just 31% of all similar readings taken over the past year.

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