Most Active Weekly Options: GoPro Inc and Ambarella Inc

Weekly option traders have recently set their sights on GoPro Inc (GPRO) and Ambarella Inc (AMBA)

Sep 14, 2015 at 11:31 AM
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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 new names on the list are mobile camera maker GoPro Inc (NASDAQ:GPRO) and semiconductor concern Ambarella Inc (NASDAQ:AMBA).

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GPRO and AMBA both took it on the chin last week, sinking the stocks well into oversold territory. However, both equities are on the rebound today, bucking the broad-market trend lower, with analysts at Northland Securities calling GPRO a "compelling acquisition target" for Apple Inc. (NASDAQ:AAPL), to which it has ties.  

Starting first with GPRO, the stock hit a new low of $31.32 on Friday, bringing its weekly loss to 12%, and its 14-day Relative Strength Index (RSI) to 17. The stock's weekly options were in favor, with eleventh-hour bulls picking up the weekly 9/11 38-strike calls -- the most active during the past five sessions. Meanwhile, bears may have picked up the weekly 9/11 37-strike put -- among the top open interest increases over the past five days -- with GPRO landing on the short-sale restricted (SSR) list last week.

During the most recent reporting period -- as GPRO sank more than 22% -- short interest surged more than 36%, and now accounts for 21.5% of the equity's total available float. Meanwhile, option bears have been more active than usual, as the stock's 10-day put/call volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits at 0.69 -- above almost two-thirds of all other readings from the past year.

It's worth noting that GPRO's Schaeffer's Volatility Scorecard (SVS) is perched at a lofty 99. In other words, the stock has tended to make outsized moves during the past year, relative to what the options market has priced in -- a boon for option buyers.

Today, the shares are 5.3% higher at $34.13, but remain nearly 46% lower year-to-date. Plus, the stock is staring up at its 10-day moving average, which has ushered GoPro Inc (NASDAQ:GPRO) lower since mid-August.

AMBA, meanwhile, also dropped 12% last week, into territory not charted since March. The equity's weekly 9/11 71-strike put was among the most actively traded during the past five sessions, with buyers betting on the stock to extend its trek south of $71.

Outside of the weekly series, AMBA's September 60 put was the most active, and saw nearly 2,750 contracts opened. Buyers of the short-term puts expect AMBA to breach $60 -- and hit six-month lows -- by this Friday's close, when the options expire.

AMBA puts have been growing more popular among buyers lately, as the stock's 10-day ISE/CBOE/PHLX put/call volume ratio of 1.00 sits higher than 86% of all other readings from the past year. Likewise, short sellers have grown fond of the underperformer, with short interest jumping 16.1% during the most recent reporting period. These bearish bets now account for almost one-third of AMBA's total available float.

As alluded to earlier, the shares of Ambarella Inc (NASDAQ:AMBA) are on the mend in a big way, possibly as traders go bargain hunting; the stock's 14-day RSI hit 21 on Friday -- well into oversold territory. At last check, AMBA was 5.3% higher at $67.79. Year-to-date, AMBA has held up much better than customer GPRO, boasting a 2015 gain of 34%.

 

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