Buzz Stocks: Honeywell, Hertz, Valeant Pharmaceuticals

Today's stocks to watch in the news include Honeywell International Inc. (NYSE:HON), Hertz Global Holdings Inc (NYSE:HTZ), and Valeant Pharmaceuticals Intl Inc (NYSE:VRX)

Jul 17, 2015 at 9:28 AM
facebook twitter linkedin

Stocks are mixed this morning, although the Nasdaq Composite looks set to hit another notable milestone thanks to well-received earnings from Google Inc (NASDAQ:GOOGL). Meanwhile, among other equities in focus are aerospace issue Honeywell International Inc. (NYSE:HON), car rental concern Hertz Global Holdings Inc (NYSE:HTZ), and drugmaker Valeant Pharmaceuticals Intl Inc (NYSE:VRX).

  • HON has been bouncing higher since hitting an annual low of $82.89 in mid-October, tacking on almost 25% to rest at $103.57. The stock looks poised to extend this momentum today -- up 2.3% in electronic trading, slightly less than the options market was expecting -- after the company posted better-than-expected second-quarter earnings and upwardly revised the low end of its full-year profit forecast. Option bears could start hitting the bricks, should today's projected price move pan out -- which could fuel Honeywell International Inc.'s fire. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), HON's 10-day put/call volume ratio of 2.69 ranks in the 98th annual percentile.

  • HTZ is poised to pop 18% out of the gate, after the firm restated its financial statements for 2011 through 2013, and upped its 2015 annual cost savings target by $300 million. Hertz Global Holdings Inc also reiterated its $1 billion share buyback plan and said it expects the spinoff of Hertz Equipment Rental Corp to be wrapped up in the fiscal second quarter. The stock could certainly use a shot in the arm, considering it's shed almost a third of its value year-to-date -- and hit a two-year low of $16.65 last Thursday -- to linger at $16.99. Option traders have kept the faith, though, per the equity's 50-day ISE/CBOE/PHLX call/put volume ratio of 6.07, which sits higher than 99% of all similar readings taken in the past 52 weeks. In other words, calls have been bought to open over puts with more rapidity just 1% of the time within the past year.

  • VRX is set to open in the red, following the firm's latest M&A announcement. Specifically, Valeant Pharmaceuticals Intl Inc said it will buy Egypt's biggest drugmaker, Amoun Pharmaceutical, for roughly $800 million as it looks to expand in the Middle East and North Africa. Longer term, the shares have had a standout run in 2015, up almost 67% at $238.85. Short-term speculators, meanwhile, have shown a preference for puts over calls, as evidenced by the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.90. What's more, this ratio ranks in the 75th annual percentile, meaning speculative traders are more put-skewed than usual. Looking ahead, VRX could draw even more attention next week, when it unveils its second-quarter earnings report.

Want an even earlier advantage on the biggest news before the bell? Sign up now to get Schaeffer's Opening View delivered straight to your inbox!


Now is the time to join our thriving community of Event Traders who consistently profit from every earnings season. With this discounted subscription opportunity, you'll stay ahead of the curve and seize opportunities others miss. Do not let Q3 earnings season pass you by – subscribe now and supercharge your portfolio with expert insights that turn market reactions into profit-generating opportunities!! Don't waste another second... join us right now before the next trade targeting +200% is released!