Options Check-Up: Plug Power Inc, FireEye Inc, and Zillow Inc

Analyzing recent option activity on Plug Power Inc, FireEye Inc, and Zillow Inc

by Elizabeth Harrow

Published on Oct 31, 2014 at 7:45 AM
Updated on Jun 24, 2020 at 10:16 AM

Among the stocks attracting attention from options traders lately are fuel cell specialist Plug Power Inc (NASDAQ:PLUG), virtual security firm FireEye Inc (NASDAQ:FEYE), and restaurant chain Zillow Inc (NASDAQ:Z). Below, we'll break down how options buyers are positioning themselves, and how much speculators are willing to pay for their bets on PLUG, FEYE, and Z.

  • Calls have been quite popular on PLUG lately, according to data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). The stock's 10-day ISE/CBOE/PHLX call/put volume ratio stands at 38.86 -- not far from its freshly tagged multi-year high of 43.96. Plug Power Inc has vaulted to a gain of 190% in 2014, but has been churning close to the $4.50 level for the past month (and ended Thursday squarely at $4.49). During the coming weeks, speculators are apparently banking on a continuation of this muted price trend. The stock's Schaeffer's Volatility Index (SVI) of 77% ranks in the slim 7th percentile of its annual range, as front-month options have rarely priced in lower volatility expectations.

  • FEYE sports a 10-day call/put volume ratio of 7.36 on the ISE, CBOE, and PHLX, which outranks 84% of comparable readings from the last year -- indicating a stronger-than-usual preference toward bullish bets over bearish during the past couple of weeks. This trend coincides with a bounce higher for FEYE shares, which have gained 35.6% from their Oct. 13 annual low of $24.81, ending Thursday's session at $33.63. Looking ahead, FireEye Inc is set to report third-quarter earnings after the market closes next Tuesday, Nov. 4, but front-month options are still fairly priced. The security's SVI stands at 74%, in the middling 48th annual percentile.

  • Z is also a favorite among call players, having racked up a 10-day call/put volume ratio of 1.51 on the ISE, CBOE, and PHLX. This ratio ranks higher than 88% of other such readings over the past year, pointing to a pronounced bullish skew among speculative players. Traders may be optimistic for a bounce from the century mark, as the $100 level has so far supported the stock's pullback from its July peak of $164.90. In fact, Z shares settled at $104.24 yesterday, up 27.5% year-to-date. Zillow Inc will announce its third-quarter results after the close next Wednesday, Nov. 5, but front-month options aren't exactly pricing in a major move. The stock's SVI checks in at 58%, in the tame 30th annual percentile.

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