Most Active Weekly Options: Delta Air Lines, Inc. and American Airlines Group Inc

Weekly options traders have been hot for American Airlines Group Inc (NASDAQ:AAL) and Delta Air Lines, Inc. (NYSE:DAL)

Karee Venema
Jul 5, 2016 at 3:42 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. Stocks 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 notable names of interest are airline stocks Delta Air Lines, Inc. (NYSE:DAL) and American Airlines Group Inc (NASDAQ:AAL).

Most Active Weekly Options July 5

Airline stocks are in the red this afternoon, amid broad-market headwinds and dismal traffic numbers for DAL. Specifically, Delta said its key passenger revenue for each seat flown a mile (PRASM) metric declined a wider-than-expected 5% in the second quarter. Additionally, DAL lowered its second-quarter operating margin forecast.

Against this backdrop, shares of DAL are down 3.7% at $35.41 -- and it looks like today's options traders could be selling to close their weekly 7/8 35-strike puts ahead of this Friday's expiration. Elsewhere, optimistic traders appear to be buying to open the weekly 7/8 35.50-strike call, eyeing an end-of-week bounce.

More broadly speaking options traders have taken the skeptical route toward Delta Air Lines, Inc., which isn't too surprising, given its 30.4% year-to-date deficit -- and last Monday's annual low of $32.60. However, with 88% of analysts maintaining a "buy" or better rating on the underperformer, the door is wide open for a round of downgrades which could pressure DAL even lower.

AAL meanwhile, was last seen down 1.8% at $28.80. The shares of AAL also hit an annual low last Monday -- tapping $24.85 -- and have shed 32% since the start of the year.

Nevertheless, short-term options traders have shown a preference for calls over puts, per AAL's Schaeffer's put/call open interest ratio (SOIR) of 0.31. Not only does this show that call open interest more than triples put open interest among options expiring in three months or less, it ranks below 93% of all comparable readings taken in the past year.

Today, in fact, the stock's August 29, 31, and 36 calls are most active, with a collective 4,529 contracts on the tape. Weekly options traders, however, appear to be purchasing new positions at the weekly 7/8 28-strike put, betting on American Airlines Group Inc to extend today's slide through Friday's close, when the series expires.

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