2014-08-26 Smart Money Report (ASML) (SCTY)

Posted on August 26th, by Mitchell Warren in Free Articles, Options Risk Management, Smart Money Report, Unusual Options Activity. Comments Off on 2014-08-26 Smart Money Report (ASML) (SCTY)

Smart Money Report

  1. ASML- Nearly 7,000 Oct $105 calls have traded with the majority being purchased for $0.75-$0.85 each, against open interest of 128 contracts. The call to put ratio is 29:1. Call activity is 15x the average daily volume. Implied volatility rose 6.2% to 22.98. The stock is retesting the $96 level from July. ASML Holdings trades at a P/E ratio of 20.22x (2015 estimates) with 42.7% EPS growth (3.9% this year), 17.2% revenue growth (9% this year), P/S ratio of 5.04x, P/B ratio of 4.02x, 0.88% dividend yield, and has an average analyst price target of $90.01. On 7/31, Morgan Stanley upgraded the stock to overweight from sector perform.
  2. CPA- Another 1,400 Feb 2015 $130 calls were bought for $7.30 each, against open interest of 1,506 contracts. This was tied to a sale of 58,800 shares. There was also stock tied to the call buying on 8/14. On average, only 175 calls trade per day. The stock goes ex-dividend tomorrow (currently has a 3.07% dividend yield).
  3. DOW- 15,000 Jan 2015 $57.50 calls were bought for $0.84 and 5,000 Jan 2015 $52.50 puts were sold for $2.52 each. Volume was above the open interest in both options. This works out to a $0.00 debit bull risk reversal. The trader sees profits above $57.50 and losses below $52.50 on Jan 2015 options expiration.
  4. MRK- 3,000 Oct 18 $60 calls were bought for $1.13-$1.21 each, against open interest of 27,706 contracts. The call to put ratio is 4:1.
  5. SCTY- 4,000 Apr 2015 $70 calls were bought for $12.60-$12.85 each, against open interest of 6 contracts. The call to put ratio is over 2:1. Net call premium is +$5.4M vs the net put premium of +$230K. SolarCity shares have been consolidating in the $69-$75 range for the last 5 weeks. The average analyst price target is currently $82.95 (1 sell rating, 3 hold ratings, 5 buy ratings).

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