Options Check-Up: Expedia Inc, FedEx Corporation, Juniper Networks

Analyzing recent option activity on EXPE, FDX, and JNPR

Digital Content Group
Dec 12, 2014 at 7:55 AM
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Among the stocks attracting attention from options traders lately are travel website Expedia Inc (NASDAQ:EXPE), package delivery concern FedEx Corporation (NYSE:FDX), and tech issue Juniper Networks, Inc. (NYSE:JNPR). Below, we'll break down how option buyers are positioning themselves, and how much speculators are willing to pay for their bets on EXPE, FDX, and JNPR.

  • EXPE has been a long-term climber on the charts, adding nearly 40% year-over-year, despite a 0.5% gain yesterday to close at $87.32. Somewhat surprisingly, sentiment in the equity's options pits is bearish. Expedia Inc's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.82 sits only 7 percentage points from an annual high, revealing puts have been bought to open over calls at a faster-than-normal pace of late. If EXPE can keep its upward momentum, though, a capitulation among these skeptics could translate into tailwinds for the shares. The stock's short-term options are currently inexpensive, on a volatility basis, per its Schaeffer's Volatility Index (SVI) of 29%, which ranks in the 11th percentile of its 52-week range.

  • Shares of FDX have been on a tear. After yesterday's 0.2% gain, the stock has now added 30% in the past 52 weeks to land at its current perch of $176.88. Options traders remain overwhelmingly bullish on FedEx Corporation, with its 50-day ISE/CBOE/PHLX call/put volume ratio of 1.42 ranking higher than 96% of all similar readings taken in the past year. However, per its SVI of 29% -- which is in its 72nd annual percentile -- FDX's near-term options are on the expensive side, from a volatility standpoint.

  • JNPR has struggled this year, shedding 5.3%. Continuing this trend, yesterday the equity lost 0.3% to close at $21.37. In the past two weeks, speculators have been betting on a reversal of fortunes. Per the equity's 10-day ISE/CBOE/PHLX call/put volume ratio, 5.09 calls have been bought to open for every put. Also, this ratio lands in the 80th percentile of its annual range, suggesting a healthier than usual appetite for bullish bets over bearish. Juniper Networks, Inc.'s short-term options can be had at bottom-dollar prices, on a volatility basis, as its SVI of 21% ranks in the 9th percentile of its annual range.

 

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