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Friday’s Vital Data: Alibaba Group Holding Ltd (BABA), Nvidia Corporation (NVDA), and Pandora Media Inc (P)

Options activity provides a look at expectations on BABA, NVDA and P

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U.S. stock futures are headed higher this morning, as Wall Street bounces back from heavy losses driven by President Donald Trump’s latest crisis — the Department of Justice has appointed a special prosecutor in the Russia investigation. Strong economic data has assuaged most of those wounds, but the major market indices are still down nearly 1% across the board for the week.

Friday’s Vital Data: Alibaba Group Holding Ltd (BABA), Nvidia Corporation (NVDA), and Pandora Media Inc (P)At last check, futures on the Dow Jones Industrial Average were up 0.17%, with S&P 500 futures rising 0.3% and Nasdaq-100 futures higher by 0.39%.

On the options front, volume remained brisk and well above the average on Thursday, with about 19.3 million calls and 19.2 million puts changing hands as traders continue to seek protection in exchange-traded funds. On the CBOE, the single-session equity put/call volume ratio ticked lower to 0.70, pushing the 10-day moving average to a fresh one-month low of 0.62.

Leading Thursday’s options activity, Alibaba Group Holding Ltd (NYSE:BABA) created a considerable stir with its fourth-quarter earnings report, which many assumed missed expectations at first glance. Elsewhere, Nvidia Corporation (NASDAQ:NVDA) scored a price-target increase at UBS and a late initiation from Bernstein after the close last night. Finally, Pandora Media Inc (NYSE:P) may be an acquisition target after reports stated the company turned down a bid from Sirius XM Holdings Inc. (NASDAQ:SIRI).

Friday’s Vital Options Data: Alibaba Group Holding Ltd. (BABA), Nvidia Corporation (NVDA), and Pandora Media Inc (P)

Alibaba Group Holding Ltd. (BABA)

BABA stock initially plunged nearly 2% after Alibaba released its fourth-quarter earnings report.

The Chinese e-commerce giant said that revenue rocketed 60% higher year-over-year to $5.6 billion, a feat achieved by few companies in the past. However, there was some confusion over earnings, which rose 45% to 63 cents per share, missing the consensus by 2 cents. After accounting for increased taxes, adjusted earnings were determined to have actually beat expectations.

Options traders weren’t fooled, however, as calls claimed 72% of the more than 850,000 contracts traded on BABA stock. The shares recovered by the close of the session, adding roughly half-a-percent. Overall, Alibaba’s June put/call open interest ratio reflects continued bullish sentiment for the stock, arriving at 0.54, with calls nearly doubling puts among near-term options.

That said, peak call OI for the series still lies at $115, with another heavy dose of calls open at the $120 strike. In short, there is still room for these bulls to adjust their targets higher.

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