Buzz Stocks: Sprint Corp, T-Mobile US Inc, and Micron Technology, Inc.

Today's stocks to watch include Sprint Corp (S), T-Mobile US Inc (TMUS), and Micron Technology, Inc. (MU)

by Mark Fightmaster

Published on Oct 2, 2015 at 10:32 AM
Updated on Jun 24, 2020 at 10:16 AM

U.S benchmarks are staring at a triple-digit loss after this morning's disappointing jobs report. Today's equities in focus are communications firms Sprint Corp (NYSE:S) and T-Mobile US Inc (NYSE:TMUS), as well as semiconductor producer Micron Technology, Inc. (NASDAQ:MU).

  1. S is 0.3% higher at $4.06 this morning, amid reports it hopes to cut $2 billion to $2.5 billion in costs over the next six months. Sprint Corp's Chief Financial Officer Tarek Robbiati noted in an internal memo that the cuts "invevitably will result in job reductions." (subscription required) On the sentiment front, skepticism is steep toward a stock that's up 31% from its late-July all-time low of $3.10. The security's Schaeffer's put/call open interest ratio (SOIR) of 2.47 sits at a 52-week high, while its 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) 10-day put/call volume ratio of 2.40 is in the 94th annual percentile. Additionally, 17 of the 19 analysts tracking S rate it a "hold" or worse. A capitulation among option bears and/or a round of upgrades could lend momentum to the stock. Finally, S is ripe for a short-covering rally, as 19% of the equity's float is sold short, and it would take nearly seven days for the bears to exhaust their pessimistic positions, at average daily trading volumes.
  • TMUS is 3.8% lower at $38.62 this morning, after yesterday's announcement of a massive data breach. The breach exposed as many as 15 million people who applied for T-Mobile US Inc's wireless service. The lower open has shares of the communications firm slightly below their 20-week moving average -- which it hasn't finished a week below since the start of the year. During that time, the stock has advanced 43%. Should the data breach give analysts reason to issue downgrades, the stock could find itself under considerable pressure. At last check, TMUS has earned 12 "strong buy" ratings and three "buys," versus just three "hold" or worse ratings.
  • MU is 6.2% higher at $15.69 this morning, after reporting fiscal fourth-quarter earnings. While Micron Technology, Inc.'s profit fell thanks to weaker computer sales, the results still topped Wall Street's expectations. Option players had been loading up on long calls ahead of the announcement, as MU's 10-day call/put volume ratio on the ISE, CBOE, and PHLX of 3.99 is higher than 89% of similar readings taken during the past year. On the charts, the shares are battling overhead resistance from their 10-week moving average. This trendline has been a major catalyst in the stock's 55% year-to-date drop. 
     

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