3 FAANG Stocks Set for Worst Day in Months

Netflix stock could suffer its worst session in over a year

Managing Editor
Nov 29, 2017 at 1:36 PM
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Stocks are trading mixed this afternoon, with the Nasdaq Composite (IXIC) sinking with tech stocks. Among the names making big moves lower are FAANG stocks Facebook Inc (NASDAQ:FB), Netflix, Inc. (NASDAQ:NFLX), and Alphabet Inc (NASDAQ:GOOGL).  Here's a quick look at what's moving shares of FB, NFLX, and GOOGL.

Facebook Stock Moves Lower Despite Barclays Note

Shares of Facebook stock have moved lower, down 4% at $175.13 -- set for their second-worst day of 2017 -- despite receiving a positive analyst note from Barclays, which opined that the social media company should be able to offset slowing ad impression growth by increasing ad prices. The analysts reiterated their "buy" endorsement and $215 price target, which represents a premium of nearly 23% to FB stock's current perch, and stands in uncharted territory. Facebook stock just yesterday touched an all-time high of $184.25, and could find an ally in its 80-day moving average, which has acted as support since early January.

FB has a Schaeffer's Volatility Index (SVI) of 16%, which ranks just 12 percentage points from a 12-month low. In other words, volatility expectations via short-term options are unusually muted right now -- a boon for premium buyers. Today, however, Facebook options are more popular than usual, crossing the tape at twice the average intraday pace, with roughly 260,000 calls and 115,000 puts exchanged.

NFLX Stock Set for Worst Day in a Year

Netflix stock is joining fellow FAANG stock FB in the red, and was last seen trading down 5.1% at $189.10 -- on pace for its worst one-day percentage loss in over a year. However, the online streaming stock is still up 60% year-over-year, and earlier bounced off its own 80-day trendline.

Call buying has been accelerated on NFLX recently. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows NFLX with a 10-day call/put volume ratio of 1.54, which ranks in the 84th percentile of its annual range. This suggests calls were bought to open over puts at a faster-than-usual clip during the past two weeks.

However, near-term options buyers were getting the contracts at a relative bargain, with the stock's SVI of 23% ranking in just the 6th percentile of its annual range. Today, NFLX options are changing hands at three times the average intraday clip, with roughly 117,000 calls and 58,000 puts traded so far.

GOOGL Stock Backs Down from Record Highs

Shares of Alphabet have also dropped, as the Google parent was last seen down 2.7% at $1,034.46 -- set for its steepest percentage loss since late July. However, Alphabet stock is still up 30% for 2017, and yesterday notched a record high of $1,080 after news of a criminal investigation into Uber espionage delayed a trial between the ride-share company and Google unit Waymo.

GOOGL has also seen an influx of call buying at the ISE, CBOE, and PHLX, most recently sporting a 10-day call/put volume ratio of 1.84, ranking in the 97th percentile of its annual range. Today, options on the FAANG stock are running at twice the average afternoon pace, with about 23,000 calls and 14,000 puts traded.


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