Buzz Stocks: Alcoa Inc, Ascena Retail Group Inc, and UTi Worldwide Inc.

Today's stocks to watch include Alcoa Inc (AA), Ascena Retail Group Inc (ASNA), and UTi Worldwide Inc. (UTIW)

by Mark Fightmaster

Published on Oct 9, 2015 at 10:18 AM
Updated on Jun 24, 2020 at 10:16 AM

U.S. benchmarks are slightly higher this morning, amid lingering optimism over the Fed's meeting minutes. Today's equities in focus are aluminum giant Alcoa Inc (NYSE:AA), women's clothing concern Ascena Retail Group Inc (NASDAQ:ASNA), and transportation company UTi Worldwide Inc. (NASDAQ:UTIW).

  1. AA is in the news this morning, after kicking off earnings season with a whimper (subscription required). The stock is 5% lower at $10.46, after the firm's much-anticipated earnings fell short of Wall Street's estimates. Alcoa Inc blamed the performance on falling aluminum prices and a dismal forex backdrop. Technically, AA has surrendered more than one-third of its value in 2015, but is attempting to notch a weekly win atop its 20-week trendline for the first time since February. Ahead of earnings, option traders were stocking up on puts at a faster-than-usual clip. AA's 10-day put/call volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) checks in at 1.27, higher than 91% of the readings taken in the past 52 weeks.
  • ASNA initially jumped 3.9%, thanks to news that Golden Gate Capital took a 9% stake in the retailer, calling it "undervalued." However, ASNA has given up those gains, and was last seen 4% lower at $13.64. Technically, shares of Ascena Retail Group Inc have made significant headway since trading south of $11 in late August, but are backing down from the $14.50-$15 neighborhood -- home to ASNA's mid-July bear gap. Short sellers have been circling the stock, as short interest rose 21.4% during the last reporting period. These bearish bets now account for 13.6% of the stock's total available float, representing nearly a week's worth of pent-up buying demand, at ASNA's average pace of trading.
  • UTIW has rocketed 47.9% higher to $6.98, thanks to news that Denmark's DSV has offered $1.35 billion to purchase the company (subscription required). Shares of UTi Worldwide Inc. touched a decade-plus low of $4.40 last week, and up until today, had underperformed the broader S&P 500 Index (SPX) by nearly 44 percentage points during the past three months. Option players are bearishly aligned toward the firm, as its 10-day put/call volume ratio on the ISE/CBOE/PHLX checks in at a hefty 6.40. Short sellers have also jumped in on UTIW, as 18% of the firm's float is sold short.

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