Early Edge: Wells Fargo, Omeros Corp, and Solazyme

Stocks making headlines include Wells Fargo & Co (WFC), Omeros Corporation (OMER), and Solazyme Inc (SZYM)

Apr 14, 2015 at 10:40 AM
facebook twitter linkedin

Despite signaling a higher open, the major market indexes are in the red, as traders digest the latest round of big-cap earnings. Among the equities making an early splash on the Street are financial concern Wells Fargo & Co (NYSE:WFC), pharmaceutical issue Omeros Corporation (NASDAQ:OMER), and renewable energy firm Solazyme Inc (NASDAQ:SZYM).

  • Like sector peer JPMorgan Chase & Co. (NYSE:JPM), WFC is fresh out of the earnings confessional. The firm reported stronger-than-expected per-share earnings and in-line revenue, and said mortgage banking revenue rose for the first quarter in five. Nevertheless, WFC is down 1.4% at $53.81, much to the dismay of a fresh crop of option bulls. Wells Fargo & Co is now testing support atop its 10-month moving average, which has ushered the equity higher since early 2012.

  • OMER is up 1.1% at $25.83, after European regulators approved the firm's OMS721 for compassionate use for thrombotic microangiopathy patients. In addition, Omeros Corporation is presenting at the Needham Healthcare Conference in New York today. The stock touched an intraday peak of $26.64 -- within a point of its record high, tagged on March 5 -- and the equity's ascent could have short sellers jittery. Short interest soared 36.6% during the past two reporting periods, and now represents almost 24% of OMER's total available float. It would take more than 17 sessions to buy back these bearish bets, at the equity's average pace of trading -- plenty of fuel for a short squeeze to propel the shares higher.

  • SZYM has rocketed 13.4% higher to $3.64, after the company announced a strategic agreement to develop and market Flocapso -- a drilling fluid additive -- with Flotek Industries Inc (NYSE:FTK). As with OMER, SZYM shorts could be running scared, as short interest represents nearly 25 sessions' worth of pent-up buying demand, at the stock's average daily volume. Likewise, option bears could hit the bricks. On the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the security's 10-day put/call volume ratio of 2.47 ranks in the 97th percentile of its annual range. In other words, option buyers have picked up Solazyme Inc puts over calls at a much faster-than-usual clip during the past two weeks.

If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!

Schaeffer's Investment Research Master Portfolio Trial


Special Offers from Schaeffer's Trading Partners