Friday’s Vital Data: Qualcomm, Inc. (QCOM), Hewlett-Packard Company (HPQ) and AT&T Inc. (T)

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The major market indices ended Thursday mostly higher, as slipping oil prices once again bolstered stocks. The S&P 500 set yet another all-time high and is on pace to log its third consecutive weekly gain. Despite the positive air on Wall Street, options traders appeared to retreat, with the CBOE put/call volume ratio surging to a two-week high of 0.71, and the 10-day moving average rebounded from a near-term low to finish at 0.61.

In equity news, Qualcomm, Inc. (NASDAQ:QCOM) announced plans to begin an accelerated stock buyback plan of $5 billion, and Hewlett-Packard Company (NYSE:HPQ) released its second-quarter earnings figures. Finally, AT&T Inc. (NYSE:T) stock rallied on news of the company’s plans to expand services into Mexico.

Friday’s Vital Data: Qualcomm, Inc. (QCOM), Hewlett-Packard Company (HPQ) and AT&T Inc. (T)

Qualcomm Inc. (QCOM)

Despite revealing plans in March to buy back $10 billion in stock during the next 12 months, Qualcomm announced yesterday that it would begin a $5 billion accelerated buyback program. According to CEO Steve Mollenkopf, “These repurchases represent a significant step toward meeting our goal of repurchasing $10 billion of common stock by March 2016.”

It was welcome news for holders of QCOM stock, which has fallen roughly 7% year-to-date. Jumping at the opportunity, options traders sent some 177,651 contracts across the tape on Qualcomm, with 56% of yesterday’s volume trading on the call side.

QCOM is currently battling for position in the $70 region, drawing heavy call activity to the region. Currently, 11,594 contracts are open at the June $70 strike, with 15,938 contracts residing at the just overhead $72.50 strike. Peak put open interest, meanwhile, totals 10,458 contracts at the $67.50 strike, which lies just above QCOM’s April lows.

Hewlett-Packard Company (HPQ)

Hewlett-Packard reported that second-quarter revenue declined 7% year-over-year to $25.45 billion, missing expectations for sales of $25.63 billion, as sales fell across most of HP’s businesses. Earnings of 87 cents per share, however, edged out the Street’s forecast by a penny.

HPQ offered a few details on its upcoming split, with the bulk of the company’s focus centering on personnel changes. The company also said the split would involve “associated dis-synergies of approximately $400 to $450 million.”

Options activity heading into the report leaned slightly toward the call side. Overall, 144,893 HPQ option contracts traded on Thursday, with just 53% of the day’s volume changing hands as call contracts. In the soon-to-expire weekly May 22 series of options, traders were heavily focused on the $34 call and the $33 put strikes, which currently sport OI of 17,559 contracts and 12,398 contracts, respectively.

In premarket trading, HPQ is bouncing around breakeven and was last seen up 0.4%, with $34 exerting overhead pressure.

AT&T Inc. (T)

Shares of blue-chip communications firm AT&T added 1.3% on Thursday to log a close north of $35 on the session. Traders bid up the shares following reports of AT&T’s latest Mexico expansion plans.

According to AT&T, it wants to create the first seamless network within the U.S. and Mexico.

Options traders appeared rather nonplussed regarding the announcement, with 63% of yesterday’s volume of 166,560 contracts trading on the put side. These puts may be smart money for T stock, as the shares have struggled to maintain any position at or near $35 since December. In fact, the June $35 put strike is home to peak near-term open interest of 228,346 contracts. By comparison, peak June call open interest numbers just 156,119 contracts at the $35 strike.

In premarket activity, T stock is edging slightly lower, but has yet to breach the $35 level.

As of this writing, Joseph Hargett did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/05/fridays-vital-data-qualcomm-inc-qcom-hewlett-packard-company-hpq-att-inc-t-options/.

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