Alibaba, Verizon, D.R. Horton News Today

Today's stocks to watch in the news include Alibaba Group Holding Ltd (BABA), Verizon Communications Inc. (VZ), and D.R. Horton, Inc. (DHI)

Jan 24, 2017 at 9:25 AM
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Investors are parsing a heavy round of corporate earnings this morning, and U.S. stocks appear set for a slow start. Among specific equities in the spotlight are China-based online retailer Alibaba Group Holding Ltd (NYSE:BABA), telecommunications stock Verizon Communications Inc. (NYSE:VZ), and homebuilder D.R. Horton, Inc. (NYSE:DHI). Here's a quick look at what's driving BABA, VZ, and DHI.

Alibaba Beats on Revenue Thanks to Single's Day Sales 

BABA is up 4.5% ahead of the bell after the company reported quarterly revenue above expectations, citing strong sales on Single's Day. The firm also raised its full-year outlook for 2017. The stock has added more than 41% year-over-year, at $98.41, and appears set to break out above the round $100 level. But while options buyers have been busy targeting Alibaba Group Holding Ltd calls in recent weeks, near-term traders have hit a put-skewed extreme. Specifically, the stock holds a Schaeffer's put/call open interest ratio (SOIR) of 0.95 -- the highest of all comparable readings from the past 12 months. Simply stated, put open interest is unusually heavy, relative to call open interest, among options set to expire in three months or less.

Disappointing Subscriber Growth Sinks Verizon

An earnings miss has VZ set to slide 3.7% at the open, with the telecom firm reporting fewer-than-expected subscribers added during the fourth quarter. Meanwhile, concerns persist about Verizon Communications Inc.'s planned purchase of Yahoo! Inc.'s (NASDAQ:YHOO) core internet business, after Yahoo said Monday the deal wouldn't close until the second quarter of this year. Analysts have yet to weigh on this morning's results, though the majority already call VZ -- which closed yesterday at $52.41 -- a "hold" or "strong sell." Options traders have been taking a glass-half-empty approach lately, as well. The stock's 10-day put/call volume ratio of 1.01 on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits near the top quartile of its annual range.

D.R. Horton Tops Expectations as New Orders Rise

DHI surpassed estimates for new home orders during the last fiscal quarter, helping the company easily blow past earnings expectations. The news has D.R. Horton, Inc. up 5.2% in pre-market trading, and should these gains materialize, the stock could be on track to repeat a bullish historical trend. At $28.74, DHI is up 8.9% over the past 12 months, and Monday broke out above its 80-day moving average, which had been pressuring the shares since early December. Near-term options traders haven't exactly been expressing confidence toward DHI. Its SOIR of 1.54 -- showing puts easily outnumbering calls among options in the front three months' series -- rests just 1 percentage point from a 52-week high. Today's upbeat news could shake some of these seemingly bearish traders loose, however, which could be a boon for the stock. 

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