Buzz Stocks: J C Penney Company Inc, Mylan NV, and Illumina, Inc.

Today's stocks to watch include J C Penney Company Inc (JCP), Mylan NV (MYL), and Illumina, Inc. (ILMN)

Nov 13, 2015 at 10:15 AM
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It's shaping up to be another day of losses on the U.S. exchanges, thanks to disappointing retail sales and ugly earnings from a blue-chip tech titan. Among the equities in focus are retailer J C Penney Company Inc (NYSE:JCP), pharmaceutical interest Mylan NV (NASDAQ:MYL), and genetic analysis issue Illumina, Inc. (NASDAQ:ILMN).

  • While JCP recently announced solid third-quarter sales, this morning's quarterly earnings report does not seem to have investors impressed. J C Penney Company Inc reported a narrower-than-expected loss of 47 cents per share, yet the stock is down 8.6% at $8.03, pressured by a broader retail swoon and ugly results from sector peer Nordstrom, Inc. (NYSE:JWN).  According to yesterday's near-term at-the-money straddle data, traders were pricing in an 8.4% swing for JCP – just shy of the stock's average one-day post-earnings move of 10.1% over the last eight quarters. And JCP's Schaeffer's put/call open interest ratio (SOIR) stands at 1.73 -- in the 92nd percentile for the past year -- indicating that near-term option traders have rarely been more put-heavy.
  • Investors in MYL seem pleased that Perrigo Company (NYSE:PRGO) shareholders rejected a $26 billion hostile bid from Mylan NV -- even though they voted in favor of the acquisition last month -- as MYL is 12.1% higher tat $48.44. Mylan had been after a deal with Perrigo for months, but the tender offer, which expired at 8:00 a.m. ET today, was called "grossly inadequate." PRGO, meanwhile, is panning annual lows in the $140 range. Mylan could be in for greater gains amid an unwinding of bearish sentiment, as 17.1% of its shares are currently sold short, accounting for more than six days of trading, at the stock's average daily volume.
  • ILMN is up 5.5% this morning, last seen trading at $163.90, on the news that the stock will be listed on the S&P 500 Index (SPX) as of next Wednesday's close, replacing Sigma-Aldrich Corporation (NASDAQ:SIAL). Illumina, Inc. shares fell to an annual low of $130 in early October, after the company issued lackluster guidance, but have rebounded 26.1% since then. Option buyers have turned bullish over the last several weeks, as ILMN's 10-day call/put volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits at 3.62 -- higher than 94% of readings from the past year.

 

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