Options Bears Rush Struggling Semiconductor Stock

Puts are running at six times their intraday average

Deputy Editor
Aug 12, 2021 at 3:38 PM
facebook X logo linkedin


The shares of Western Digital Corp (NASDAQ:WDC) are down 6.8% to trade at $62.18 at last check, falling alongside sector peer Micron Technology (MU), after Morgan Stanley downgraded MU, citing future weakness in the chip sector, specifically in dynamic random-access memory (DRAM) prices. 

On the charts, the stock earlier dipped below the 200-day moving average for the first time since November. The $60 level, which the equity bounced off earlier this month, helped contain today's pullback. Year-to-date, WDC is up 12.4%. 

WDC 0812

Meanwhile, the security is being bombarded with bearish options activity. So far, 35,000 puts have crossed the tape -- six times the intraday average -- with volume running in the top percentile of its annual range -- compared to 20,000 calls. Most popular by far is the weekly 8/27 58-strike put, where new positions are being bought to open. 

The majority of analysts are bullish on Western Digital stock. Of the 19 in coverage, 15 carry a "buy" or better rating, with four a tepid "hold." Plus, the 12-month consensus price target of $92.78 is a 49.1% premium to current levels. 

Lastly, now looks like a good time to weigh in on the WDC's next move with options. The stock is seeing attractively priced premiums at the moment, per the equity's Schaeffer's Volatility Index (SVI) of 36%, which sits in just the 6th percentile of its annual range.

 

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI