Monday’s Vital Data: Apple Inc. (AAPL), Facebook Inc (FB) and Netflix, Inc. (NFLX)

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Wall Street is headed for a negative open this morning, as traders weigh their options after a meeting of the world’s major oil producing countries failed to produce an agreement to slow production. In overseas trading, crude tumbled more than 3% to hover near $39 per barrel. As a result, U.S. stock futures on the Dow Jones Industrial Average were last seen lower by 0.25%, while S&P 500 futures had shed 0.33% and Nasdaq Composite futures were off 0.32%.

Options volume ramped up considerably on Friday, with traders shifting into high gear for a fresh wave of corporate earnings. On the CBOE, the single-session equity put/call volume ratio fell to 0.63, as the 10-day moving average held at 0.67 for the fourth-consecutive session.

In equity options news, Apple Inc. (NASDAQ:AAPL) options traders flooded AAPL stock on Friday with earnings slated to hit the Street April 25 after the close. Meanwhile, Facebook Inc (NASDAQ:FB) also saw heavy earnings-related activity, though a deal with Live Nation Entertainment, Inc.’s (NYSE:LYV) Ticketmaster unit likely provided additional fuel for the fire. Finally, Netflix, Inc. (NASDAQ:NFLX) traders made last-minute preparations ahead of today’s first-quarter earnings report.

Monday’s Vital Options Data: Apple Inc. (AAPL), Facebook Inc (FB), and Netflix, Inc. (NFLX)

Apple Inc. (AAPL)

There was a smattering of non-earnings-related news late last week on Apple, including rumors of an all-glass casing for the iPhone and a security flaw for the Windows version of Quicktime. But next week’s earnings report was the real driver for Apple options activity on Friday, with analysts setting an earnings target of $2 per share, versus whisper of $2.04 per share.

AAPL stock saw record short-term volume on Friday, with more than 2.2 million contracts changing hands on the day. The sentiment read from Friday’s activity is leaning bearish, as calls only accounted for 54% of the day’s take. Overall, $110 is still the strike to watch, as AAPL continues to fail to overcome this technical hurdle.

Looking at weekly April 29 series open interest, the $110 strike has attracted more than 61,000 calls and 57,000 puts. Implieds are currently pricing in a post-earnings move of nearly 6% for AAPL stock following earnings.

Facebook Inc (FB)

Facebook stock is also seeing heavy earnings-related options activity, though an FB deal with Ticketmaster may also have a hand in recent options volume. Total volume on Friday rose to more than 642,000 contracts, with calls accounting for a below-average 57% of overall activity for FB stock.

Facebook is expected to report earnings after the close of trading on Wednesday next week, with analysts expecting a profit of 62 cents per share. The earnings whisper sits three cents higher at 65 cents.

While the weekly April 29 series $110 strike should be the one to watch heading into earnings, the out-of-the-money $115 strike has attracted the most call OI for the series. Currently, the at-the-money $110 strike sports call and put OI of roughly 5,400 contracts each. However, the April 29 series $115 call strike has attracted some 12,000 contracts, hinting that expectations may be rather elevated for Facebook’s quarterly report.

Netflix, Inc. (NFLX)

Get your positions in for NFLX today, as Netflix is slated to release its quarterly report after the close of trading today. Options activity was hot and heavy on NFLX stock on Friday, with nearly 445,000 contracts changing hands on the session. Calls were unusually popular for NFLX, accounting for 63% of the day’s take.

Optimism has begun to creep into NFLX’s sentiment backdrop as earnings draws near, a trend that has run counter to Netflix’s usual sentiment outlook, and one that could have bullish effects on NFLX post earnings.

The April 22 series $110 strike remains the one to watch for NFLX this week, with 7,000 calls and more than 2,000 puts currently open at this in-the-money strike. That said, both the $120 and $125 call strikes have attracted OI of more than 8,000 contracts each, indicating that many traders are expecting a pop from NFLX stock following tonight’s quarterly report.

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/2016/04/mondays-vital-data-apple-inc-aapl-facebook-inc-fb-netflix-inc-nflx/.

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