Most Active Options: 3D Systems Corporation and J C Penney Company Inc

With earnings in focus, 3-D printing firm 3D Systems Corporation (NYSE:DDD) and retail stock J C Penney Company Inc (NYSE:JCP) have been targeted by options traders

Nov 3, 2016 at 1:27 PM
facebook X logo linkedin

The 20 stocks listed in the table below have attracted the highest total options volume among mid-cap names 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 3-D printing firm 3D Systems Corporation (NYSE:DDD) and retail stock J C Penney Company Inc (NYSE:JCP). Here's a closer look at how options traders are lining up on DDD and JCP -- which are both on the quarterly earnings radar.

most active options update november 3

DDD posted a better-than-expected third-quarter profit earlier, although it fell short on revenue. Nevertheless, the stock is up 5.1% at $13.74, widening its year-to-date advance to 58.1%. However, the shares are struggling to regain a foothold atop their 200-day moving average, after slipping below this historically supportive trendline on Tuesday.

Meanwhile, in the options pits, volume has surged to three times what's typically seen at this point in the day, with more than 21,000 contracts traded. Puts are outpacing calls by a wide margin, with 13,000 of the former on the tape, versus fewer than 8,000 of the latter. Most active is DDD's November 12 and 13 puts, where it looks like one speculator may be closing out of a put spread ahead of expiration at the close on Friday, Nov. 18.

More broadly, front-month put players have targeted DDD's November 16 strike, which is home to the stock's top open interest position of 10,140 contracts outstanding. According to Trade-Alert, it looks like the bulk of the action in recent months has been of the buy-to-open kind, meaning put buyers are betting on 3D Systems Corporation settling south of $16 at front-month options expiration.

JCP will take its turn in the earnings confessional ahead of the open next Friday, Nov. 11, and options traders have been upping the bearish ante of late. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), for instance, JCP's 10-day put/call volume ratio has jumped to 1.29 from 0.31 in the past two weeks. What's more, the current ratio ranks in the 85th annual percentile.

Short-term traders have been particularly put-skewed, per JCP's top-heavy Schaeffer's put/call open interest ratio (SOIR) of 1.93 -- just 8 percentage points from a 52-week peak. Drilling down, the stock's weekly 11/11 8.50-strike put has seen the biggest rise in open interest over the last two weeks, with 14,867 contracts added.

Looking at the charts, JCP stock is down 0.7% at $8.36, after Jim Cramer offered up a lackluster outlook during last night's "Mad Money Lightning Round." Specifically, Cramer said that J C Penney Company Inc "is much better run than it used to be ... but don't buy any more." Longer term, the equity is down 26% since topping out at its most recent high near $11.30 in mid-August, and recently lost a foothold atop a trendline that's connected a series of higher lows this year.

Sign up now for Schaeffer's Market Recap to get all the day's big stock movers, must-know technical levels, and top economic stories straight to your inbox.

Unlock Weekend Profits with Chris Prybal's Favorite Strategy Up +487.5% in 2024

With the markets going left, right, and sideways, you need to have a plan now more than ever. 

Expert Trader Chris Prybal is no stranger to volatility, and has mastered finding big stock rallies while other traders aren't looking over the weekend. Rallies that produced gains like +207% on RTX calls, +236% on MARA calls, and +238% on NET calls.

A few simple moves on Sunday at 7pm could be the “Secret Sauce” your portfolio needs to not just stay afloat, but make unprecedented gains in this turbulent market.

Don’t sit on the sidelines, beat the market with Chris Prybal's strategy. Join him now!