Skyworks Solutions, Inc. (SWKS) Explores Triple Digits, Draws Bulls

Skyworks Solutions Inc (SWKS) traders are buying March calls

Mar 20, 2015 at 2:02 PM
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Skyworks Solutions Inc (NASDAQ:SWKS) is up 2.1% -- and earlier touched an all-time high of $101.80 -- after B. Riley upped its price target by $22 to $117 while underscoring its "buy" opinion of the equity. The upgrade comes as no surprise, considering that SWKS has advanced a staggering 39.8% year-to-date to hit $101.63, and is on pace for its first-ever close above the century mark. Accordingly, call activity in the options pits has been elevated, as traders gamble on last-minute upside.

Calls have been moving at nearly double the average rate today, and are outpacing puts by a roughly 2-to-1 margin. Two of today's most active contracts are the March 100 and 101 calls, where buy-to-open activity has been detected. By purchasing these calls, traders anticipate the security will keep pushing its way above the strikes by the close today, when the contracts expire.

Despite SWKS' impressive ascent on the charts, puts have been prevalent in the options pits. Specifically, the stock's 50-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.49 stands higher than 94% of all similar readings of the past year. Echoing this indicator is SWKS' Schaeffer's put/call open interest ratio (SOIR) of 0.84, which reads in the 96th percentile of its annual range. Simply stated, short-term traders are more put-skewed than usual.

Meanwhile, the brokerage bunch is overwhelmingly bullish on Skyworks Solutions Inc (NASDAQ:SWKS), as 86% of covering analysts rate the stock a "strong buy," with no "sell" or worse recommendations to be found. However, SWKS' consensus 12-month price target of $94.76 sits below current trading levels, showing that additional price-target hikes could be on the way.

Daily Chart of SWKS Since March 2014
 

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