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Thursday’s Vital Data: Walt Disney Co (DIS), Netflix, Inc. (NFLX) and Advanced Micro Devices, Inc. (AMD)

Options activity provides a look at expectations on DIS, NFLX and AMD

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U.S. stock futures are trading broadly lower once again this morning, as traders are still feeling the pinch from rising rhetoric between the U.S. and North Korea. Yesterday, the North detailed plans to strike at U.S. military bases in Guam, with one commander stating “Sound dialogue is not possible” with President Donald Trump and “only absolute force can work on him,” according to North Korean state media.

Thursday’s Vital Data: Walt Disney Co (DIS), Netflix, Inc. (NFLX) and Advanced Micro Devices, Inc. (AMD)At last check, futures on the Dow Jones Industrial Average had fallen 0.25%, Nasdaq-100 futures were down 0.64% and S&P 500 futures had lost 0.41%.

On the options front, volume remained brisk and puts continued to gain favor amid rising tensions with North Korea. Overall, about 16.6 million calls and 16.5 million puts trading, resulting in a single session put/call volume ratio of 0.99. Meanwhile, the CBOE single-session equity put/call volume ratio vaulted to 0.83 — a four-month high — while the 10-day moving average hit its own four-month high of 0.70.

Turning to Wednesday’s options activity, Walt Disney Co (NYSE:DIS) reported poorly received third-quarter earnings and announced it was not renewing its content deal with Netflix, Inc. (NASDAQ:NFLX). Puts piled up on both DIS stock and NFLX shares as a result. Meanwhile, Advanced Micro Devices, Inc. (NASDAQ:AMD) was once again the target of a bearish research note, this time from Barclays, which called for a 30% cut in AMD’s stock price.

Wednesday’s Vital Options Data: Walt Disney Co. (DIS), Netflix, Inc. (NFLX) and Advanced Micro Devices, Inc. (AMD)

Walt Disney Co (DIS)

Walt Disney reported that third-quarter earnings that fell 5% year-over-year to $1.58 and revenue that came in flat at $14.2 billion.

Earnings were just above the Street’s targets, and sales were just below, but it was Disney’s decision to dump $1.8 billion into streaming video company BAMtech to create its own online streaming service and ditch its deal with Netflix in the process. With DIS stock shedding nearly 4% on the news, investors were clearly skeptical of the move.

DIS options traders also expressed their displeasure with Disney. Volume came in at 186,000 contracts, rising to more than 600% of DIS’ daily average. What’s more, 54% of that activity was of the put (or bearish) variety. Looking out to September options, it appears that traders are expecting DIS to fall below the psychologically significant $100 level, as more than 20,000 put contracts have accumulated at this just out of the money strike.

A breach of $100 could confirm a bearish downtrend for DIS now that the shares have breached both their 50-day and 200-day moving averages.

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