Here is some generally directional, untied options activity that caught my eye during Thursday’s trading:
1. QQQ – the Nasdaq 100 etf saw a large bearish roll when the etf was $105, a trader sold 50,000 of the Mat 105/100 put spreads at 1.47 to close and bought 50,000 May 102/97 put spreads to open for 94 cents. On Wednesday CC updated our bearish position in the QQQ (read here).
2. AMAT – saw an opening call buyer when the stock was just 22.55 a trader paid 1.13 for 9,000 Oct 26 calls. Call volume ran almost 2x average daily volume with calls outnumbering puts more than 4 to 1.
3. QCOM – when the stock was $66.88 a trader paid .22 for 5000 April 10th weekly 70 calls to open. These calls break-even at $70.22 up 5% on April 10th, while this is not a ton of premium for an institution ($110,000), the short dated nature, the choice of weeklies and the out of the money nature is interesting. The expiration misses earnings on April 22nd, but maybe playing for upward pressure from a portion of the recent buyback that could be accelerated. The options market is only placing about a 10% chance these options are in the money.
4. CDW – the re-seller of computer hardware and software saw some opening put buying, when the stock was 36.83 a trader paid .37 for 3000 April 35 puts. The stock only has open interest of 23,000 options coming into the day. The single largest strike of open interest is 8,000 of the April 40 calls. The stock caught my eye in light of the weakness across tech in the PC supply chain over the last month, as they are uniquely tied to the demand by small and medium sized businesses in the U.S. for technology products. The stock is cheap, trading at a forward PE/G (trades about 14x expected 14% eps growth) of about 1 which is becoming increasingly unique among tech stocks and at .5x price to expected sales ($64 billion market cap and $12.8 billion expected 2015 sales). The stock has been in a very healthy uptrend since the October lows, but most recently failing to make a higher high, which makes any test of the uptrend that much more important in the coming days: