Market Overview

Expert Discusses Options Activity In Facebook, Qualcomm, FireEye and Whole Foods Ahead Of Earnings


Facebook Inc (NASDAQ: FB), QUALCOMM, Inc. (NASDAQ: QCOM), FireEye Inc (NASDAQ: FEYE) and Whole Foods Market, Inc. (NASDAQ: WFM) are reporting third-quarter financial results on Wednesday after the market closes.

Benzinga spoke with TD Ameritrade's Chief Strategist JJ Kinahan, who shared some comments on options activity in these stocks ahead of the earnings calls.


Kinahan first went into Facebook, which has been meandering around its 52-week high for a couple of weeks. The options market is pricing in a move of just under 6 percent, the expert said.

Looking at volumes, he noted that people are buying the $100 puts in the weeklies. Further up, he was also seeing “the $105’s, $107’s and $110 calls (...) So, based on what we are seeing in some of the other stocks, there’s a lot of –I hate to use the word hope but there really is a little bit of- hope,” given the strong results of other big Internet players.


The strategist then looked into QUALCOMM, where the market is expecting a move of just over 4.5 percent based on earnings. He highlighted that there’s nothing outstanding in terms of implied volatility or options activity, however.

“I guess the story here is that, at one time, this was a favorite of the market, and it’s kind of fallen out of favor for the market.”

Whole Foods Market

Whole Foods Market, opposite to most other big stocks in the market, has fallen since the start of October.

The expert noted that the implied volatility in the stock reached the 98th percentile, “so relatively, their options are pretty high-priced.” The market is expecting a move of approximately 10 percent on earnings.


Finally, the expert went into one of the hottest stocks in the cybersecurity arena: FireEye. "Their volume is kind of falling off,” he noticed. “People are still interested, but not to the level they once were."

What’s interest here, Kinahan pointed out, are out of the money calls and puts, which “have a lot of buyers.” The $28 and $27.50 puts, and the February $28 calls are seeing interesting volume.

In terms of the expected movement, the market is pricing in a 7.5 percent move on the stock based on earnings.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.

Posted-In: JJ Kinahan TD AmeritradePreviews Options Exclusives Markets Movers Trading Ideas


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