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Tuesday’s Vital Data: Texas Instruments, Beyond Meat and Apple

Options activity provides a look at expectations on TXN, BYND and AAPL

U.S. stock futures are sinking this morning on pre-Federal Reserve jitters. Rather than brave the uncertain outcome of the two-day Fed meeting, which kicks-off today, some traders are heading for the exits.

Tuesday's Vital Data: Texas Instruments, Beyond Meat and Apple
Source: Shutterstock

Ahead of the bell, futures on the Dow Jones Industrial Average are down 0.41%, and S&P 500 futures are lower by 0.56%. Nasdaq-100 futures have lost 0.85%.

Yesterday’s action in the options pits was relatively subdued with overall volume sinking to well below average levels. Calls won the day with some 15.8 million contracts traded versus 13 million contracts for puts.

Meanwhile, over at the CBOE, the single-session equity put/call volume ratio ramped to 0.71. That matches its highest reading in six weeks. The 10-day moving average climbed to 0.65.

Options traders swarmed in the following stocks: Texas Instruments (NASDAQ:TXN), Beyond Meat (NASDAQ:BYND) and Apple (NASDAQ:AAPL).

Let’s take a closer look:

Texas Instruments (TXN)

Fresh off its earnings beat, Texas Instruments scored additional follow through on Monday, gaining 1.7% on the session. Volume threw its weight behind bulls, registering the third accumulation day in four trading sessions.

Last week’s catapult boosted the semiconductor industry and aided the broader market’s march to new highs. With the 20-day, 50-day and 200-day moving averages all pointing higher, it’s the bull’s game to lose. TXN stock is a buy into weakness.

On the options trading front, TXN exhibited typical behavior ahead of its quarterly dividend payment. Traders snatched up calls for short-term control of the stock so they could receive the stock’s 77 cent payout. With an annual yield of 2.37%, TXN is one of the higher income-generating stocks in the sector. Total activity grew to 544% of the average daily volume, with 92,151 contracts traded; 90% of the trading came from call options alone.

Implied volatility ticked higher on the session to 23%, but remains at a lowly 14th percentile. Premiums are pricing in daily moves of $1.89 or 1.5%.

Beyond Meat (BYND)

Red-hot shares of Beyond Meat are cooling after-hours, following a disappointing earnings report and the announcement of a secondary offering. BYND stock is currently down $33 or 15% premarket.

For the second quarter, the producer of plant-based alternative meat reported a loss of $9.4 million or 24 cents per share on revenue of $67.3 million. The company announced a secondary public offering of 3.25 million shares. The majority of the shares (3 million) are coming from insiders unloading a portion of their holdings to capture the meteoric gains seen since the IPO.

This morning’s down gap will bring a critical test to BYND stock’s uptrend. Thus far, all dips have been rapidly bought. The rising 20-day moving average and a key old resistance zone lie in wait near $180. A breach of this zone will send warning flags up to chart watchers.

On the options trading front, calls stole the show yesterday. Activity ramped to 191% of the average daily volume, with 272,228 total contracts traded. Calls accounted for 57% of the tally.

Apple (AAPL)

Apple is one of the few marquee tech names yet to report earnings this season. But spectators don’t need to wait long. The maker of all i-things is slated for its announcement after the close today. In preparation for the event, we saw options traders jockeying for positions yesterday. The uptick in activity will undoubtedly continue today.

Traders favored puts by a slim margin on the session. Total trading rose to 129% of the average daily volume, with 439,920 contracts traded. Puts claimed 53% of the session’s sum.

The increased demand drove implied volatility higher on the day to 29%, placing it at the 34th percentile of its one-year range. The expected earnings jump in the stock is $8.12 or 3.9%.

On the price front, the two-month uptrend pushed to a new high Monday and places AAPL within striking distance of its 2019 peak. A better-than-expected earnings release will be needed to clear it.

As of this writing, Tyler Craig didn’t hold a position in any of the aforementioned securities. Check out his recently released Bear Market Survival Guide to learn how to defend your portfolio against market volatility.


Article printed from InvestorPlace Media, https://investorplace.com/2019/07/tuesdays-vital-data-texas-instruments-beyond-meat-and-apple/.

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