Buzz Stocks: Merck & Co., Inc., United Continental Holdings Inc, and Signet Jewelers Ltd.

Today's stocks to watch in the news include Merck & Co., Inc. (MRK), United Continental Holdings Inc (UAL), and Signet Jewelers Ltd. (SIG)

Jan 11, 2017 at 9:23 AM
facebook twitter linkedin


Futures on major U.S. indexes are mixed ahead of this morning's press conference from President-elect Donald Trump. Among specific equities in the spotlight are drug stock Merck & Co., Inc. (NYSE:MRK), airline interest United Continental Holdings Inc (NYSE:UAL), and jewelry retailer Signet Jewelers Ltd. (NYSE:SIG). Here's a quick look at what's driving MRK, UAL, and SIG.

  • MRK announced the U.S. Food and Drug Administration  (FDA) has accepted its supplemental Biologics License Application for its key lung cancer treatment, Keytruda, for review. Merck & Co., Inc. expects a decision from the FDA by May 10. The news has the stock up 2.9% ahead of the open, and as of last night's close at $59.92, MRK is sitting on a solid 16% year-over-year lead. But the shares could get an extra boost should seemingly pessimistic options traders abandon their positions. After all, MRK sports a Schaeffer's put/call open interest ratio (SOIR) of 1.96 -- showing put open interest roughly doubling call open interest among options set to expire in the next three months. Moreover, this reading ranks just 7 percentage points from an annual put-skewed high.

  • UAL is 1.8% higher ahead of the bell, after the company lifted its revenue guidance for the fiscal fourth-quarter. Also boosting the stock is news the U.S. Department of Justice will not bring changes against United Continental Holdings Inc, or other major airlines, after completing an investigation into collusion concerns. Plus, UAL received a round of upbeat brokerage attention, including price-target hikes from Evercore ISI ($80), UBS ($90), and Citigroup ($75). The stock has been soaring since last June -- gaining almost 60% in the past six months -- with the 40-day moving average providing support on a recent pullback. And short sellers seem to be backing away, with their bearish bets falling by over 26% during the two most recent reporting periods.
  • SIG lowered its fourth-quarter outlook, citing slow holiday sales -- in line with what's been seen from many other retailers of late. The news has the stock sliding 4.1% in pre-market trading, and at Tuesday's finish of $87.46, the shares are already off more than 7% in 2017 -- not exactly the type of first-quarter strength historically seen from Signet Jewelers Ltd. The equity could be in even more trouble, should analysts begin to lower their opinions. At present, nine out of 13 brokerages call SIG a "buy" or better, and not one rates it a "sell." Plus, the average 12-month price target of $109.57 sits at a 25% premium above current levels. 

Stay on top of overnight news & big morning movers. Sign up now for Schaeffer's Opening View.

 

If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!

SCHAEFFER'S JULY STOCKS REPORT AD
 


 


 
Special Offers from Schaeffer's Trading Partners