Unusual Options Activity: Netflix (NFLX)

Shares to head higher through October. Over 10,500 contracts traded on the October $285 call option on Netflix (NFLX), a 76-fold increase in volume given the contract’s prior open interest of 140. With 43 days to go before expiration, the option is a bet that shares will trend higher. Netflix shares trade around $288, putting these $285 calls $3 in-the-money. Any change in Netflix shares from here should cause the option to move dollar-for-dollar, less the decline of the remaining time premium. Netflix is set to post its next earnings report just before the option expires. The distributer and creator of media ...
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Insider Activity: 8×8 (EGHT)

CEO adds over 3,000 shares. Vikram Verma picked up over 3,000 shares of 8x8 (EGHT), where he serves as CEO. The buy cost just over $73,000 and leaves the CEO with just over 889,000 shares of the company. This marks his second buy this year, following a 4,200 share purchase in August. Insiders have a mixed track record at the company, with these CEO buys being offset by sales by the Chief Product officer year-to-date. 8x8 is a cloud communications company offering solutions for small and midsized businesses worldwide. The company’s business model includes software-as-a-service and also offers virtual office, communication, and ...
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Deutsche Bank Argues for Micron Rally

Business set to improve. A research note released by Deutsche Bank suggests that shares of Micron (MU) are set to rally, as the business is likely to improve. The analyst note suggests that the Q4 DRAM price action was a temporary trough for business. Other fears surrounding shares, specifically Japan-Korea trade issues, are unlikely to result in supply problems for Micron as well. Deutsche reiterated their “Buy” rating on Micron, with a price target of $55, about 17 percent higher than current prices. Micron manufactures and sells memory and storage solutions, including DRAM, Flash, and other data memory storage, including cloud storage and ...
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SunTrust, MoffettNathanson Upgrade Square (SQ) to Buy

Consumer payments company upgraded from neutral. Payment company Square (SQ) has dropped 24 percent in the past six months, far underperforming the broader information technology space. That’s led to an upgrade in shares from MoffettNathanson, citing the likelihood of financials “grinding higher.” Square’s sale of its Caviar division, and the larger-than-expected scale of its Cash App outlook also makes the company look like a compelling buy here. Separately, SunTrust also upgraded Square to a buy rating on the same day. SunTrust’s analyst sees the company investing appropriately to address the complex issues that it faces, and also the sale of its Caviar division as ...
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Unusual Options Activity: ExxonMobil (XOM)

Bet on major share price decline by June. Over 1,070 contracts traded on the June 2020 $40 puts on ExxonMobil (XOM), a 10-fold surge in volume based on the prior number of open contracts. With a current share price of the major integrated oil company around $68 per share, the $40 bet implies a $28 per share downside in the next nine months, or about 42 percent. While such moves are common in many energy stocks, they’re unusual in major integrated companies such as Exxon. ExxonMobil shares have never traded under $60 in the past five years, let alone anywhere near a strike ...
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Insider Activity: FGL Holdings (FG)

Major hedge fund owner adds to stake of life insurer. Hedge fund Blackstone Group, already a 10 percent owner, has added to FGL Holdings (FG) with a 167,000 share buy. With a cost of $1.3 million, it increases the fund’s share count in FGL to just over 45 million shares. This is the second recent buy from Blackstone of FGL shares in the past week, with the second buy coming in at just under 290,000 shares at a cost of $2.3 million. Founded in 2016, FGL Holdings sells individual life insurance products and annuities in the United States. The company also provides reinsurance ...
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Wolfe Research Upgrades Big Banks

Trading revenue likely to rise in coming quarters. Although big banks have struggled as fears of lower interest rates indicate a slower economy and slower lending activity, some analysts are seeing potential upside ahead. In a research note, Wolfe Research upgraded big banks like JPMorgan Chase (JPM), Citigroup (C) and Bank of America (BAC), citing the likelihood to surprise investors with higher trading revenue in the coming quarters, “if activity levels hold steady.” Additionally, lower funding costs for banks from the decline in interest rates could increase their profitability, even if new lending activity remains muted. While the overall levels may only boost ...
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Unusual Options Activity: Amarin Corporation (AMRN)

Bet in 50 percent drop in shares by October. On Friday before the long weekend, over 14,400 contracts traded on the October $10 put options on Amarin Corporation (AMRN). With a prior open interest of just 123 contracts, the trade saw a surge in volume over 116-fold! With a current share price around $15 per share, the $10 strike price is a bet on shares dropping by at least as much as one-third in the next 45 days. Amarin is a pharmaceutical company that engages in the development of therapeutics for the treatment of cardiovascular diseases. Action to take: The bet against shares in ...
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