Options Radar: Ashland, Ford Motor, and Starwood Hotels & Resorts

Reviewing notable options activity on Ashland Inc, Ford Motor Company, and Starwood Hotels & Resorts Worldwide Inc

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Published on Oct 16, 2014 at 12:05 PM
Updated on Apr 20, 2015 at 5:09 PM

Three stocks seeing notable options activity today are chemical company Ashland Inc (NYSE:ASH), U.S. automaker Ford Motor Company (NYSE:F), and hospitality expert Starwood Hotels & Resorts Worldwide Inc (NYSE:HOT). Here's a look at how today's options traders have been placing their bets on these three names.

  • Ashland Inc (NYSE:ASH) is off 1.1% around midday, and is just above the flat line on a year-to-date basis, at $97.73. Ahead of the company's fiscal fourth-quarter earnings report (scheduled the night of Wednesday, Nov. 5), puts are flying off the shelves at 38 times the expected intraday rate. ASH's 30-day at-the-money (ATM) implied volatility (IV) has soared 16.2% to 34.5%, indicating elevated demand for short-term strikes, as well. Drilling deeper, buy-to-open activity is being detected at ASH's November 85, 90, and 95 puts, as confirmed by data from Trade-Alert. In other words, option bears are rolling the dice on additional downside in the equity.

  • Ford Motor Company (NYSE:F) has added 1.3% to trade at $13.80, but remains 10.6% lower year-to-date. Meanwhile, calls are trading at a slightly accelerated rate, and the stock's 30-day ATM IV earlier hit a 12-month high, suggesting short-term options are highly sought-after. F's most active call is the weekly 10/31 13.50 strike, which is being bought to open per Trade-Alert, as traders gamble on continued upside for the shares. Within the lifetime of these calls is Ford's third-quarter earnings report, scheduled bright and early next Friday, Oct. 24.

  • Starwood Hotels & Resorts Worldwide Inc (NYSE:HOT) is up almost 3% to hover near $72.90, but remains 8.3% south of breakeven in 2014. Not surprisingly, calls are the options of choice today, changing hands at nearly quadruple the expected rate at this point in the session. Earlier, in fact, HOT's 30-day ATM IV hit a 52-week high, signaling expectations for increased short-term volatility ahead of the hotel chain's third-quarter earnings report, due out the morning of Tuesday, Oct. 28. Getting down to details, it appears traders are buying to open HOT's October 72.50 call, in the hopes of additional upside through tomorrow's closing bell. Trade-Alert also supports this theory.

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