Buzz Stocks: AT&T, Navistar, and G-III Apparel Group

Today's stocks to watch include AT&T Inc. (T), Navistar International Corp (NAV), and G-III Apparel Group, Ltd. (GIII)

Andrea Kramer
Sep 2, 2015 at 9:22 AM
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After a rough Tuesday, the pendulum is once again swinging to the bulls' side. Among the equities in focus are telecom titan AT&T Inc. (NYSE:T), military vehicle maker Navistar International Corp (NYSE:NAV), and clothier G-III Apparel Group, Ltd. (NASDAQ:GIII).

  • T is pointed 1.5% higher, with help from an upgrade to "buy" from "neutral" at Citigroup. The brokerage firm waxed optimistic on AT&T Inc.'s recent acquisition of DirecTV (NASDAQ:DTV), and said the stock's recent pullback provides an opportune entry point to go long. Separately, T last night said it learned of an unsolicited "mini-tender" offer of $31.30 per share from TRC Capital, which it has recommended shareholders reject. On the charts, T has indeed pulled back with the broader equities market, finishing at $32.32 yesterday -- down 3.8% year-to-date. In fact, the $32 level has emerged as a familiar line of support, containing the equity's dips since April 2012. Option traders are betting on a bounce, as the stock's 50-day call/put volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits at 1.38, in the 92nd percentile of its annual range, pointing to a healthier-than-usual appetite for long calls over puts of late.

  • NAV is staring at a 13.8% drop out of the gate, and could explore record-low territory, after the company confessed to its 12th straight quarterly loss. In addition, things are ramping up with the Securities and Exchange Commission (SEC), and enforcement action could be the next step. Technically, Navistar International Corp has surrendered nearly half its value in 2015, settling at $17.36 yesterday. It's no surprise to find that short interest accounts for more than one-quarter of NAV's total available float -- representing nearly nine sessions' worth of pent-up buying demand, at the stock's average pace of trading. However, if today's expected plunge comes to fruition, NAV may land on the short-sale restricted list. 
  • GIII is on pace for a 4.8% surge at the open, after the firm unveiled solid quarterly earnings and raised its full-year forecast. A post-earnings rally could shake loose some bears, and prompt a short squeeze. At GIII's average daily trading volume, it would take more than a week to buy back all the shorted shares. However, analysts are already in the bulls' corner, with seven of nine offering up "strong buy" opinions. G-III Apparel Group, Ltd. was flirting with record highs in mid-July, and today's anticipated jump should place the shares back above former support at their 10-week moving average. GIII finished at $66.91 yesterday.

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