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

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

Oct 31, 2014 at 7:45 AM
facebook twitter linkedin


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.
 

Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

 
Schaeffer's Daily Bulletin Offer
 


 


 
Special Offers from Schaeffer's Trading Partners