Too Many Options: S, XLU, SUNE, AMAT, AAL, WYNN

by Enis May 2, 2014 5:42 am • Commentary

Calls were more active than puts (CBOE put/call closed at 0.81) after the fourth straight day in the green for the Nasdaq.  However, single stock options activity was quite low once again.

1.  S – Sprint has been active this week as speculation mounts of a bid by Sprint for T-Mobile.  S has rallied more than 10% so far this week, though it is still down 19% so far in 2014.  Calls traded more than 4x the average 1 month daily volume, with the May 9 calls trading over 50k on the day, at an average price of 0.31.

2.  XLU – Utilities are having a monster year, up more than 13% year-to-date already.  The etf is approaching its all-time high of $44.66 from December 2007.  Options were active yesterday, and the May30th 43 puts were the most active line, trading over 30k at an average price of 0.53.

3.  SUNE – Active on the call side once again.  Buyer of 20k of the Jan15 25 / 30 call spread for 1.08 to open.  SUNE last traded above $25 in 2008.  The stock’s high in 2014 is $21.93.  The company is expected to report earnings next week.

4.  AMAT – AMAT has sold off more than 10% in the past month, but remains positive on the year.  Buyer of 9,527 of the Jan15 22 calls for 0.90 in the morning.  AMAT reports earnings in mid-May.

5.  AAL – Buyer of 10k of the Jan15 40 / 45 call spread for 1.40 to open.  AAL’s high since it started trading publicly again in December is $39.88 in March.  The stock is already up 44% so far in 2014.

6.  WYNN – In front of earnings yesterday, a someone paid 4.55 to buy 4600 of the May17th 195 puts to open.  The break-even is down 7.5% by May expiration.  WYNN traded up about 3% in the after-market yesterday after its earnings report.