Options traders bet on Apple’s earnings to spark rally in AAPL shares

“Options traders are betting that Apple Inc.’s quarterly earnings will boot up a rally in its shares,” Saumya Vaishampayan reports for The Wall Street Journal. “The maker of iPhones and Mac computers is scheduled to report fiscal fourth-quarter earnings after the bell on Tuesday. Analysts expect earnings of $1.88 a share, up from $1.42 a share a year earlier, according to Thomson Reuters. Revenue is forecast to rise to $51.1 billion from $42.1 billion a year ago.”

“Trading in call options has outpaced trading in put options in recent sessions. A call grants the right to buy shares of a company at a certain price, called the strike, by a certain time. A put confers the right to sell shares,” Vaishampayan reports. “Apple’s put-to-call ratio was 0.5 on Tuesday, less than its 22-day average of 0.7, according to options-data provider Trade Alert. The 10 most heavily traded Apple options were all calls, most of which granted the right to buy shares above Apple’s current price of roughly $116.

Vaishampayan reports, “In particular, investors have recently been snapping up call options that grant the right to buy shares at $120, said JJ Kinahan, chief strategist at TD Ameritrade. ‘If you look at the straight options activity, it does seem to be bullish,’ he said, adding that it’s not unusual to see that ahead of earnings.”

Read more in the full article here.

MacDailyNews Take: We shall see in 3 and a half hours.

SEE ALSO:
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Apple: Why $116-$120 will soon be history – October 26, 2015
Apple’s earnings next week may set a new Nasdaq record – October 24, 2015
Apple to release Q415 earnings, webcast live conference call on October 27th – October 8, 2015

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