Options Check-Up: Alcatel Lucent, BlackBerry Limited, and Yelp Inc.

Analyzing recent option activity on Alcatel Lucent SA (ADR) (ALU), BlackBerry Ltd (BBRY), and Yelp Inc (YELP)

by Griffin Kruse

Published on Feb 5, 2015 at 8:13 AM
Updated on Apr 20, 2015 at 5:32 PM

Among the stocks attracting attention from options traders lately are France-based telecom provider Alcatel Lucent SA (ADR) (NYSE:ALU), Canadian wireless issue BlackBerry Ltd (NASDAQ:BBRY), and restaurant review website Yelp Inc (NYSE:YELP). Below, we'll break down how options traders are positioning themselves, and how much speculators are willing to pay for their bets on ALU, BBRY, and YELP.

  • ALU, which will release its latest earnings results after the open on Friday, added 0.8% yesterday to reach $3.61. However, the stock has lost over 13% on a year-over-year basis. Bullish sentiment in the stock's options pits is ramping up, per its 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 76.06, which is higher than 89% of all other annual readings. What's more, traders are paying historically cheap prices for their near-term bets on Alcatel Lucent SA (ADR), with its Schaeffer's Volatility Index (SVI) of 53% sitting lower than 80% of all similar readings taken over the past year.

  • Shares of rumored takeover target BBRY are up about 41% since hitting an annual low of $7.01 on April 14, despite a 0.5% loss yesterday, to rest at $9.88. Sentiment in BlackBerry Ltd's options pits is currently bearish, with its 10-day ISE/CBOE/PHLX put/call volume ratio of 0.55 sitting in the 90th percentile of its annual range. Likewise, the brokerage bunch is also pessimistic about BBRY's future, with 83% of covering analysts doling out "hold" or worse ratings on the equity. Short-term options for BBRY are pricing in tepid volatility expectations, as its SVI of 54% sits in the 33rd percentile of all similar readings taken annually.

  • YELP gained 1.7% yesterday to hit $56.74, but is still down 24.6% year-over-year. Ahead of tonight's earnings release, sentiment in Yelp Inc's options pits is nearing a bullish peak, with the stock's 50-day ISE/CBOE/PHLX call/put volume ratio of 2.30 sitting 3 percentage points away from the highest reading taken over the past year. Speculators are paying middling prices for their bets on YELP, with its SVI of 79% sitting in the 61st annual percentile.

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