Buzz Stocks: Target Corporation, Fairchild Semiconductors Intl Inc, and NQ Mobile Inc

Today's stocks to watch include Target Corporation (TGT), Fairchild Semiconductor Intl Inc (FCS), and NQ Mobile Inc (ADR) (NQ)

by Kirra Fedyszyn

Published on Nov 18, 2015 at 10:01 AM
Updated on Nov 18, 2015 at 10:04 AM

U.S. exchanges are trying for a third straight win, with a slew of Fed officials slated to speak and the latest Federal Open Market Committee (FOMC) meeting minutes on tap. Among the equities in focus are retail giant Target Corporation (NYSE:TGT), computer chip producer Fairchild Semiconductor Intl Inc (NASDAQ:FCS), and China-based mobile Internet provider NQ Mobile Inc (ADR) (NYSE:NQ).

  • Before the opening bell this morning, TGT reported quarterly earnings that met expectations, and upped its full-year earnings forecast. Nevertheless, while the shares of Target Corporation were higher in pre-market trading, the stock has dropped 4.2% this morning, sitting at $69.83. One group that should be pleased is short sellers. Short interest on Target has been surging leading up to the company's earnings report, and now represents more than six days' worth of trading, at TGT's typical volumes. The security's 50-day put/call volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) also stands at 1.16 -- just 1 percentage point short of an annual bearish high. 
  • FCS will be bought by ON Semiconductor Corp (NASDAQ:ON), in a deal valued at $2.4 billion, or $20 per share -- nearly a 12% premium over Fairchild Semiconductor Intl Inc's Tuesday close. The deal has FCS up 9% today, last seen trading at $19.48. This is just the latest in a series of M&A news within the semiconductor industry this year, as companies try to keep up with the demand for cheaper chips. Prior to today, FCS had lost 5.9% so far this year, but had outperformed the S&P 500 Index (SPX) by nearly 29 percentage points over the last three months. Meanwhile, options traders have looked favorably on the stock, as its 50-day call/put volume ratio of 8.37 on the ISE/CBOE/PHLX -- indicating more than eight calls bought for every put -- is higher than 97% of readings taken in the past year.
  • NQ is up 1.8% this morning, last seen trading at $3.89, after agreeing to sell Beijing Tianya Co., Ltd. to Tack Fiori International Group -- a company based in the Cayman Islands and traded in Hong Kong. Beijing Tianya operates NQ Mobile Inc's health applications related business. The positive effect on the shares probably has short sellers sweating, as 12.7% of the stock's available float is currently sold short -- accounting for nearly four weeks of trading, at NQ's typical daily pace. Options traders might be pleased, however, as NQ's Schaeffer's put/call open interest ratio (SOIR) of 0.17 is lower than all but 4% of readings in the past year, indicating that near-term traders are showing an extreme preference for calls over puts.

     


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