Options Traders are Going Wild for These 2 Stocks

Options bears are piling on ARLQ amid today's surge

by Lillian Currens

Published on Jun 14, 2019 at 2:53 PM

Markets are slightly lower today after Apple supplier Broadcom (AVGO) issued a revenue warning. Several other stocks are making noise today, too, including biopharma company ArQule, Inc. (NASDAQ:ARQL), travel agency Bluegreen Vacations Corporation (NYSE:BXG), and real estate name Ashford Hospitality Trust, Inc. (NYSE:AHT). Here's what's moving the shares of ARQL, BXG, and AHT.

ARQL Stock Pops on Positive Drug Data

Drugmaker ArQule joined sector peer Kura Oncology (KURA) in releasing upbeat drug data at the European Hematology Association annual meeting in Amsterdam. ARQL said its experimental ARQ 531 therapy, used to treat Bruton's tyrosine kinase (BTK) in patients with hematologic malignancies excelled in a Phase 1 study. The shares of ArQule earlier hit a new 12-year high of $9.10, and are now trading 31.8% higher at $8.29 -- eyeing their best day since early March. 

Options traders are swarming the pharma concern, with over 14,000 contracts across the tape so far, four times what's typically seen at this point. While calls outnumber puts by total volume, options bears are still piling on these pessimistic positions. The 6,156 puts on the tape represent roughly nine times the average intraday, and are at a new 52-week peak. Buy-to-open activity is detected at the June 7.50 put, as traders brace for a quick retreat.

Bass Pro Settlement Gives BXG Stock a Much-Needed Boost

Travel advisor Bluegreen Vacations just agreed to pay outdoor sports retailer Bass Pro $20 million in a settlement brought against the company earlier this year. The two companies amended their Marketing and Promotions Agreement and BXG's access to Bass Pro's marketing channels have been re-established, though Bluegreen admits to no wrongdoing.

While the stock is still nowhere close to closing its late-May bear gap, BGX shares made some headway with a 38% surge. The stock is now trading back atop the $10 level for the first time since its plummet, last seen at $11.05, and is set to close above its 20-day moving average for the first time in nearly a month. 

However, with the shares recently trading near record lows, shorts have started cashing in, with these bearish bets down 11% during the last two reporting periods. The security is still heavily shorted, though, with the roughly 1.27 million shares sold short representing a whopping 18% of the stock's available float.  

Analyst Drubbing Has AHT Option Bears Running 

Ashford Hospitality stock just hit a new nine-year low of $3.47 today after the firm halved its second-quarter per-share dividend payment to 6 cents from 12 cents. The stock is down 14.9% at $3.65, at last check, dragged even lower by a price-target cut to $5 from $6 at Baird. Now, the equity is eyeing its fourth straight day in the red, and its biggest one-day drop since 2011. 

Options traders are taking notice, with 1,941 contracts exchanging hands so far, 10 times the intraday volume. The June 5 put is by far the most popular, with the majority of these contracts being bought to open. This indicates that traders are expecting AHT stock to hold beneath the $5 region until the contract expires next Friday, June 21.

From Schaeffer's Pro Traders
Trade Weekly Options Like a Pro

Direct from our Schaeffer's traders, your FREE guide to profiting with weeklies!


 
 

Partnercenter


NEW! Explore Schaeffer’s Partners' deals and get connected to top online brokerages with deals tailored exclusively for our readers.  Get answers to your questions regarding transfer fees, commission rates, programs and available discounts related to online trading services.

MORE | MARKETstories


Choosing the Right Online Broker
Click to continue to advertiser's site.
3 Penny Stocks Making Huge Moves Higher
Three stocks under $5 making notable moves
Analysts Slam CSX With Bear Notes After Earnings
CSX blamed trade conditions for its second-quarter earnings and revenue miss
Choosing the Right Online Broker
Click to continue to advertiser's site.