Volume Dark Horse: Astea (ATEA)

Posted in General  on March 25th, 2011
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Astea International Inc. (Nasdaq: ATEA) may not exactly be a household name but the price surge and volume spike alone should have traders, speculators, and small-cap investors busy today and well into next week.  The company is a “provider of service lifecycle management and mobility solutions” and it is up big after earnings. 

For its December 31, 2010 quarter, Astea reported a 27% gain in revenues to $7.1 million and next income rose more than 200% to $1.2 million or $0.34 EPS.

Software license revenues of $2.6 million were 58% higher than the same period in 2009.  Service and maintenance revenues were $4.5 million compared to $4.0 million for the same period in 2009. 

Astea noted that it has expanded its market opportunity and global presence and claimed to be more optimistic about the economic environment for the service management market space than it has been in past quarters.  It further noted an increased momentum in new customer acquisitions and accelerated growth in its pipeline.

In less than 25 minutes we have shares up a whopping 85% at $7.40 on more than 700,000 shares.  This one hit a new 52-week high of $7.64 today and even after this pop the company’s market cap is a mere $26.6 million.  Stay tuned.

JON C. OGG

Websense Volume Spike Alert: M&A Rumor (WBSN)

Posted in General  on March 16th, 2011
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Websense, Inc. (NASDAQ: WBSN) just saw a major volume spike on WSJ reports that the company is now exploring a sale.  The online monitoring and security company saw shares pop on major volume.

At 1:47 PM EST we have shares up 9.5% at $22.37 on more than 1.77 million shares versus an average daily volume of about 420,000 shares.

Its 52-week trading range is $17.03 to $27.96 and the market cap here is north of $910 million.  Thomson Reuters has estimates of $1.51 EPS and $363.35 million in revenues for 2011.

As with all M&A news leaks, these should be considered rumor until there is proof of a deal in the works.

JON C. OGG

Finisar Fallout Spreads Wide (FNSR, JDSU, OCLR, ALU, CIEN, HLIT, AFOP)

Posted in pre-market  on March 9th, 2011
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Finisar Corporation (NASDAQ: FNSR) turned in a lackluster earnings report and lowered guidance well under plan after a weak China climate and other factors.  You already know the news because this about looking for primary and secondary fallout.

JDS Uniphase Corporation (NASDAQ: JDSU) is now trading down over 11% at $22.55 on over 500,000 shares pre-market as of 8:05 AM EST.  JDSU shares traded over 4.7 million shares in NASDAQ after-hours trading last night.

Oclaro, Inc. (NASDAQ: OCLR) is trading down 12.75% at $14.50 on over 20,000 shares at 8:05 AM EST.

Alcatel-Lucent (NYSE: ALU) is also down about 2.2% at $5.40 on over 200,000 shares at 8:05 AM EST.

CIENA Corp. (NASDAQ: CIEN) is trading down 5% at $24.40 on thin volume.  Harmonic Inc. (NASDAQ: HLIT) is down 2.3% at $9.35 on thin volume.  Alliance Fiber Optic Products Inc. (NASDAQ: AFOP) is down 2% at $12.75 on thin volume.

Finisar shares closed at $40.04 and the stock is now indicated down at $25.47 for a 36%+ drop and we already saw a whopping 575,000 shares traded as of 8:05 AM EST this morning.  Finisar went out at $25.70 on more than 4.3 million shares in the after-hours trading session alone.

JON C. OGG

Sonus Ready for Major Volume Spike (SONS)

Posted in after-hours, pre-market  on March 1st, 2011
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Sonus Networks, Inc. (NASDAQ: SONS) rose handily last night and this morning we have shares higher with a pre-market volume spike.  The news was that the infrastructure equipment and software maker for wireline and wireless telephone service providers crushed earnings estimates.  Last night in teh after-hours session we saw shares up almost 30% at $3.92 on more than 2.5 million shares after the 4PM close.

This morning as early as 7:40 AM EST we have shares up around $3.80 on more than 30,000 shares.  The average volume here is about 2.6 million shares.  The 52-week trading range is $2.12 to $3.75, so today is likely to also mark a 52-week high.

The takeaway from last night and this morning is a simple one.  Look for an exponential volume move today.  The low share price will attract many new investors looking for that extra juice from low-priced stocks.  The magnitude of the beat is going to likely drive very active stock trading today for what was a market cap of $837 million.

JON C. OGG

Mother of all Volume Spikes for Molycorp (MCP)

Posted in General, Options, pre-market  on February 11th, 2011
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Molycorp, Inc. (NYSE: MCP) is going to have the mother of all volume spikes this Friday.  The company has priced a $180 million offering of 5.50% mandatory convertible preferred stock being sold by the company AND it priced 13,500,000 shares of common stock at a price per share of $50.00 which are being sold by the shareholders.  The $50.00 pricing is against a close of $51.15 on Thursday and is nearly a 10% discount of this week’s highs above $55.00.

Here is what you need to know… The dilution has been expected for quite some time and the details of this offering became much more clear at the start of this week.  We do not agree with necessarily every aspect of this call, but a fresh technical analysis was offered by INO in Molycorp and silver versus gold.

Shares are down 1.5% at $50.36 in the pre-market trading and we have seen more than 275,000 shares trade hands as of only 8:07 AM EST with nearly 90 minutes remaining in the pre-market.

Record volume days were as follows:

  • January 24 at 11.35 million shares, $46.82 close;
  • January 6 at 12.56 million, $52.86 close;
  • January 4 at 14.395 million shares, $61.80 close;
  • January 3 at 16.9 million shares, $57.50 close;
  • December 28 at 16.67 million shares, $46.18 close;
  • October 28 at 16.01 million shares; $33.89 close;
  • IPO date of July 29 at 10.1 million shares; $12.85 close.

Today is very likely to challenge the record for an all-time high in share volume.  Oddly enough, not a single option strike price in Feb-2011 nor in March-2011 has an open interest of more than 10,000 contracts.

JON C. OGG

7 Unusual Stock & Option Volume Standouts on Friday (ANN, CIEN, CSTR, DLB, JDSU, LVS, NG)

Posted in General, Options  on February 4th, 2011
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Friday is always an interesting day when it comes to volume spikes.  Buyout rumors, contract award rumors, drug events, management changes and more all tend to get speculated on each Friday.  We are looking at some key equity volume spikes as well as the options volume spikes that stand out as unusual.

AnnTaylor Stores Corp. (NYSE: ANN) saw unbelievable options trading Friday.  At 2:30 PM EST there had already been some crazy trading in the FEB-2011 $24.00 CALLS.  We saw some 26,757 contracts trade versus an open interest of only 929 contracts.  Shares were up 2.8% at $23.67 and volume in the stock was over 3 million shares versus average volume of 2.3 million shares.  The 52-week trading range is $14.21 to $28.24.  This is about 20X on options volume and it was all one-sided with no correlated PUT volume spike anywhere close to the same magnitude.

CIENA Corp. (NASDAQ: CIEN) was up as a JDSU winner… Shares at 2:30 PM EST were up 11.9% at $26.36 and they hit a new 52-week high of $26.95.  Volume was 14 million shares versus 5.86 million on average, call its almost 200% above normal volume.

Coinstar Inc. (NASDAQ: CSTR) is getting shelled again after earnings, odd considering that it had already warned about its results.  When bad gets worse… at 2:30 PM EST shares were down 12% at $38.88 against a 52-week range of $25.82 to $67.56.  The trading volume was over 9 million shares versus an average volume of about 1.7 million shares.

Dolby Laboratories, Inc. (NYSE: DLB) was down 9% at $55.96 and trading volume was over 3.1 million shares versus 532,000 shares on average.  This is despite earnings and revenue growth, and call that 500% volume spike!

JDS Uniphase Corporation (NASDAQ: JDSU) was partying like it was back in 1999… Shares hit the highest levels not seen since mid-2006 after revenues were ahead of expectations.  At 2:30 PM EST shares were up almost 26% at $22.58.  Volume was over 29 million shares versus about 4.8 million shares on average.  Shares are now up 200% from the year-low.

Las Vegas Sands Corp. (NYSE: LVS) saw active trading after a post-earnings sell-off.  Shares were down 7.6% at $46.43 on 41 million shares versus 34 million on average. The standout volume was in the options trading.  At 2:30 there were already more than 100,000 CALLS and over 40,000 PUTS in FEB-2011 expirations alone.

NovaGold Resources Inc. (AMEX: NG) was not active in stock but was a big standout in options. The March-2011 $11 PUTS saw a whopping 39,737 options contracts trade versus an open interest of 43,880 contracts.  Shares were up 0.9% at $14.78 and this appears to be a close-out trade rather than anything sinister as only 5.8 million shares had traded against average volume of about 6.2 million shares.

JON C. OGG

Huge Volume Spikes from Egypt & Region (APA, EGPT, AFK, FFD, TUR, TKF, ISL, EIS, GAF)

Posted in block volume, General  on January 28th, 2011
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We won’t bother telling you what has been going on in Egypt. You’ve seen the news and it isn’t pretty with the riots and the protests.  What is standing out is some severe volume spikes in what are otherwise less thought of stocks and trading instruments.

Apache Corp. (NYSE: APA) is down another 1.1% at $115.02 after having been as low as $110.20 today but volume was almost 15 million shares right before the close after having traded 12.8 million shares on Thursday.  Average volume is barely 2.7 million shares.  Apache has 20% to 30% of its gross from the Egypt region.

Market Vectors Egypt Index ETF (NYSE: EGPT) was down 4% at $16.11 on more than 1.1 million shares versus an average volume of only about 30,000 shares.

Market Vectors Africa Index ETF (NYSE: AFK) does have Tunisia exposure but shares were down 4.3% at $32.36 on 190,000 shares versus average volume of only about 37,000 shares.  Another is the Morgan Stanley Frontier Emerging Markets (NYSE: FFD) was down 5.2% at $14.28 on 127,000 shares versus an average volume of only about 20,000 shares.

iShares MSCI Turkey Investable Market Index (NYSE: TUR) and the Turkish Investment Fund Inc. (NYSE: TKF) were both down even worse than Egypt today, more on concerns that Turkey has some similarities of Egypt but they are not tied today.  The TUR was down 6.9% at $58.07 on 720,000 shares versus average volume of less than 400,000 shares. TKF was down 5.6% at $15.10 on 217,000 shares versus an average of less than 50,000 shares.

If you are having trouble in the North African and Middle East regions, then you can’t ignore Israel… The Aberdeen Israel Fund Inc. (NYSE: ISL) was down 4.3% at $16.75 on over 30,000 shares versus an average volume of only about 10,000 shares.  The iShares MSCI Israel Cap Investable Market Index (NYSE: EIS) was down 3.1% at $57.84 on 125,000 shares versus an average volume of only 54,000 shares.

The SPDR S&P Emerging Middle East & Africa (NYSE: GAF) was down almost 5% at $68.62 on more than 100,000 shares versus an average daily volume of under 35,000 shares.

This doesn’t even take into consideration the shippers and other secondary and tertiary players in the region.

JON C. OGG
3:44 PM EST

Increased Put Options Review Before Earnings (CRM, VMW, JNPR, NFLX, AMZN)

Posted in Options  on January 24th, 2011
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An article in Barron’s this weekend against Salesforce.com (NYSE: CRM) and the risks associated with chasing its 100-times forward earnings multiple is adding some weight on the shares of several key high-flying tech shares ahead of this week’s earnings.

Virtualization leader VMware Inc. (NYSE: VMW) is reporting earnings after the close on Monday and Thomson Reuters has estimates of $0.44 EPS and $803.54 million in revenues; for the next quarter estimates are $0.41 EPS and $783.7 million in revenues.  The 52-week range is $41.30 to $97.61.  The F5 Networks news took away some oomph from the stock here an dthis still trades at more than 50-times DEC-2011 fiscal earnings estimates.  Shortly after 2:00 PM EST we have seen more than twice as many PUTS as CALLS trade in the FEB11 options expiration.  Over 8,000 contracts traded on the PUTS.  The breakeven for speculative PUTS at the $85 strike: over $7.00 lower from the price of $88.79.

Networking player Juniper Networks Inc. (NASDAQ: JNPR) is due with earnings on Tuesday and Thomson Reuters has estimates of $0.37 EPS and $1.12 billion in revenues; for the next quarter estimates are $0.34 EPS and $1.09 billion in revenues. Its 52-week range is $22.25 to $38.73 and shares were at $30.54 about 90 days ago.  At $34.83, the breakeven to the closest speculative FEB11 PUT is a drop of more than $2.70 or an implied price of $31.30 or less.  As earnings will come tomorrow, look for options trading to be more precise Tuesday over Monday.

Home video delivery leader Netflix Inc. (NASDAQ: NFLX) is due to report earnings Wednesday and  Thomson Reuters has estimates of $0.71 EPS and $597.23 million in revenues; for the next quarter estimates are $0.88 EPS and $670.98 million in revenues.  Shares were at $194.84 just on January 18 and hit a high of $209.24 on December 1.  This was just about $150.00 about 90-days ago.  The outlook will make the difference here more than just the past.  Netflix is seeing more speculative PUT volume tahn it is CALL volume.   AT $182.00, the breakeven in PUTS would call for the stock to fall under $173.00 for the PUT option to pay off… In short, it requires a $9.00 drop to be profitable.

On Thursday comes the earnings from Jeff Bezos and firends at Amazon.com Inc. (NASDAQ: AMZN). Thomson Reuters has estimates of $0.88 EPS and $12.98 billion in revenues; for the next quarter estimates are $0.76 EPS and $9.3 billion in revenues.  Shares recently peaked out at $191.60 before everyone saw the writing on the wall elsewhere at other hi-beta and high-flying tech stocks.  The 52-week trading range is $105.80 to $191.60 and it is going to take much more than the Kindle to justify a 52-times earnings multiple for its DEC-2011 consensus estimates. We will hold off on analyzing PUTS in Amazon until Thursday gets closer because the BEB11 actions is showing more CALLS volume by far then in PUTS.  That may be due to the Bank of America Merrill Lynch call this morning reiterating Buy and a $198 target but it may just be that there is still more than three full trading sessions before it reports earnings.  On a guess today, speculative PUT buyers would have to see a drop of close to $7.00 with shares at $177.30.  That would put the breakeven close to $170.00.

Stay tuned.  This week will be key for many of these high flying hi-beta stocks.

JON OGG

Option Expiration’s Largest Open Interest Contracts (GE, MSFT, PFE, INTC, YHOO, CSCO, WFC, SPY, QQQQ, FXI, XLK, XHB)

Posted in Options  on January 21st, 2011
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Today marks the January 2011 options expiration date. There are many active options expiring, and the reason these are so large is because many are LEAPS rather than just normal monthly options.  The old rule of thumb is that options tend to drift toward their closest and most active options contract strike prices.  We identified the largest contracts with the highest open interest. These are all in major players and in major ETFs after that.

General Electric Co. (NYSE: GE) JAN11 $20 Call has 234,732 contracts; JAN11 $19 Call has 209,801 contracts; Share price at 11:30 $19.46.

Microsoft Corporation (NASDAQ: MSFT) JAN11 $30 Call 210,520 contracts; MSFT $27.50 Call 162,676 contracts…. Share price at 11:30 $28.10.

Pfizer Inc. (NYSE: PFE) JAN11 $17.50 Call… 186,517 contracts; JAN11 $20 Call… 192,992 contracts; Share price at 11:30 $18.25.

Intel Corporation JAN11 $22.50 Call has 186,623 contracts; JAN11 $21.00 Call has 164,583 contracts… Share price at 11:30 $20.90.

Yahoo! Inc. (NASDAQ: YHOO) JAN11 $17.50 Call has 161,010 contracts; Share price at 11:30 $16.01.

Cisco Systems, Inc. (NASDAQ: CSCO) JAN11 $19 Put has 142,583 contracts and the $20 Put has 136.060 contracts; Share price at 11:30 $20.78.

Wells Fargo & Co. (NYSE: WFC) JAN11 $30 Call… 104,257 contracts; Share price at 11:30 $32.49 so look at the $32.50: Call has 67,906 contracts and Put has 42,812 contracts.

In ETFs:

SPDR S&P 500 (NYSE: SPY) JAN11 $125 Put has 358,490 contracts; Share price at 11:30 $128.74.

PowerShares QQQ (NASDAQ: QQQQ) JAN11 $54 Put has 217,276 contracts; Share price at 11:30 $56.04.

iShares FTSE China 25 Index Fund (NYSE: FXI) JAN11 $40 Call has 138,131 contracts and teh $40 Put has 136,096 contracts; Share price at 11:30 $43.45, so other strike prices matter more.

Technology Select Sector SPDR (NYSE: XLK) JAN11 $26 Call… 132,322 contracts; Share price at 11:30 $25.86.

JON C. OGG

Intel Pre-Earnings Options Analysis (INTC)

Posted in Options  on January 12th, 2011
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Intel Corporation (NASDAQ: INTC) is due with earnings Thursday after the close and we could not help but notice two key issues around the options trading in Intel.  First was that the volatility is much lower and the options market is not expecting a huge price move from earnings.  Second would be that the bias remains much more skewed to a bullish bias.

The CALL options trading was far more active with more than 85,000 of the JAN11 CALLS traded versus less than 40,000 of the JAN11 PUTS traded.

Shares closed up 1.2% at $21.30 Wednesday and the 52-week trading range is $17.60 to $24.37. The bias is bullish going into earnings as far as the options are concerned and frankly the volatility here loos lower than normal as we’d assign a mere $0.50 to $0.60 expected move based upon the closing price of the closest PUTS and CALLS.

Stay tuned, maybe those figures and expectations will widen out a tad on Thursday since that is the actual earnings date.

JON C. OGG