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Options Check-Up: Dunkin' Brands, Krispy Kreme, Keurig

Analyzing recent option activity on Dunkin Brands Group Inc (DNKN), Krispy Kreme Doughnuts (KKD), and Keurig Green Mountain Inc (GMCR)

Feb 3, 2015 at 8:11 AM
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Among the stocks attracting attention from options traders lately are doughnut makers Dunkin Brands Group Inc (NASDAQ:DNKN) and Krispy Kreme Doughnuts (NYSE:KKD), as well as coffee concern Keurig Green Mountain Inc (NASDAQ:GMCR). Below, we'll break down how options traders are positioning themselves, and how much speculators are willing to pay for their bets on DNKN, KKD, and GMCR.

  • Despite a strong start to the year, DNKN shed 2.2% yesterday to close at $46.26. Meanwhile, sentiment in the options pits is nearing an optimistic peak ahead of this Thursday morning's fourth-quarter earnings report, with Dunkin Brands Group Inc's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 25.84 sitting higher than 96% of all similar readings taken in the past year. Traders are currently paying a pretty penny for their pre-earnings bets on DNKN, with its Schaeffer's Volatility Index (SVI) of 30% sitting in the 83rd percentile of its annual range.

  • Shares of KKD have put in an uninspiring performance in 2014 -- down 2% year-to-date, including a 0.7% fall yesterday that brought the stock to $19.34. Surprisingly, sentiment in the equity's options pits is bullish, with Krispy Kreme Doughnuts' 50-day ISE/CBOE/PHLX call/put volume ratio of 3.35 sitting in the 94th percentile of its annual range. Additionally, short-term options for the stock are available at bottom-of-the-barrel prices -- relatively speaking -- per its SVI of 31%, which sits lower than 91% of all other comparable readings taken in the past 52 weeks.

  • GMCR has also been trending lower, with the stock losing about 21.4% since hitting an all-time high of $158.87 on Nov. 18 to trade at $124.82. Sentiment in the equity's options pits is divided in the lead-up to tomorrow evening's fiscal first-quarter earnings report, with Keurig Green Mountain Inc's 10-day ISE/CBOE/PHLX put/call volume ratio of 0.85 sitting in the middling 55th percentile of its annual range. Although earnings are looming, near-term options for GMCR are available for relatively fair prices, as its SVI of 56% rests higher than just 51% of all similar readings taken over the past year.
 

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