Buzz Stocks: Regeneron Pharmaceuticals Inc, Sears Holdings Corp, and ITC Holdings Corp.

Today's stocks to watch include Regeneron Pharmaceuticals Inc (REGN), Sears Holdings Corp (SHLD), and ITC Holdings Corp. (ITC)

by Alex Eppstein

Published on Feb 9, 2016 at 9:29 AM

Another sell-off in crude oil could hit U.S. stocks this morning. Meanwhile, drugmaker Regeneron Pharmaceuticals Inc (NASDAQ:REGN), retailer Sears Holdings Corp (NASDAQ:SHLD), and utilities concern ITC Holdings Corp. (NYSE:ITC) are among the equities in focus today.

  • REGN is bracing for a sharp drop out of the gate, after the company reported weaker-than-forecast earnings and offered up downbeat guidance for its eye drug Eylea. In pre-market trading, the shares are down 6.5%, putting them on track to notch an annual low at the open after closing yesterday at $390.53. This may not be what short-term speculators were expecting out of Regeneron Pharmaceuticals Inc. Specifically, the stock's Schaeffer's put/call open interest ratio (SOIR) stands at 1.22. While this means put open interest outstrips call open interest on an absolute basis among options with a shelf-life of three months or less, the SOIR actually rests in the call-skewed 31st percentile of its annual range.

  • SHLD offered up discouraging news for shareholders earlier, saying same-store sales dropped over 7% in the fourth quarter and offering up a current-quarter sales estimate below expectations. In addition, Sears Holdings Corp announced plans to shutter at least 50 unprofitable stores in the coming months. As such, the stock is down 3.4% ahead of the open, and could make a run at a new 16-year low today. Already, SHLD is down more than 45% year-over-year at $16.73. Meanwhile, short sellers have been upping the bearish ante, with short interest growing 7.5% during the last two reporting periods and now accounting for 27.4% of the stock's total float. At SHLD's average daily volume, it would take over four weeks to cover these bearish bets.

  • ITC will be acquired by Canada-based Fortis Inc. in a deal worth $11.3 billion. Under the terms of the agreement, ITC Holdings Corp. shareholders will receive $44.90 per share, or $22.57 in cash plus 0.752 Fortis shares. In pre-market trading, ITC is currently up 2.6% after closing at $39.38 on Monday. Over the past several months, traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have been placing bullish bets over bearish at a breakneck speed. Specifically, the stock's 50-day call/put volume ratio comes in at a top-heavy 24.51, outstripping nearly three-quarters of all readings from the prior year.
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