Most Active Weekly Options: Twitter, Inc. and LinkedIn Corporation

Short-term options traders are targeting Twitter Inc (TWTR) and LinkedIn Corp (LNKD)

May 12, 2015 at 2:52 PM
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The 20 stocks listed in the table below have attracted the highest total weekly options volume during the past 10 trading days. Names highlighted are new to the list since the last time the study was run, and data is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. Two names of notable interest are microblogging platform Twitter Inc (NYSE:TWTR) and professional networking site LinkedIn Corp (NYSE:LNKD).


TWTR has gotten hammered in recent weeks, pressured by a prematurely released earnings report that fell shy of expectations. Specifically, relative to the stock's April 27 close at $51.66 -- the session prior to the leak -- the shares have plunged 27.3% to trade at $37.54.

Not surprisingly, option traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have been placing bearish bets over bullish at an accelerated clip of late. TWTR's 10-day put/call volume ratio of 0.44 across those exchanges ranks in the 69th percentile of its annual range. In today's trading, however, May-dated calls have taken center stage, with the 38, 38.50, and 39 strikes leading the way.

Elsewhere, analysts are divided on TWTR. Of the 28 brokerage firms tracking the stock, one dozen have handed out "strong buy" ratings, with the remainder designating the security a "hold." However, the shares' consensus 12-month price target of $47.67 stands at a 27% premium to the current perch.

Like TWTR, LNKD recently hit a rough patch -- gapping 18.6% lower on May 1, on the heels of a downwardly revised current-quarter revenue forecast. As such, the stock is sitting on a 12.7% year-to-date deficit, at $200.45 -- with the underfoot 200 strike serving as support in recent weeks.

In terms of sentiment, LNKD's 10-day ISE/CBOE/PHLX put/call volume ratio is 1.01, with puts and calls being bought to open at roughly the same pace. However, this ratio registers in the top quartile of its 12-month range, suggesting speculators have picked up bearish bets over bullish at a faster-than-usual speed, relatively speaking. In today's action, the May 200 put -- LNKD's most popular option -- may be seeing some buy-to-open activity.

Shifting gears, the brokerage bunch is quite bullish toward the shares. Nineteen of 28 covering analysts consider LNKD a "buy" or better, and the stock's average 12-month price target of $256.72 represents expected upside of 28% to current trading levels.


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