“With Apple Inc. trading more than 30 percent below last October’s record high heading into its earnings report, options investors appear to be unenthused about the pending results, especially after the iPhone maker already warned they’ll fall short of previous estimates,” Gregory Calderone reports for Bloomberg.
“Options prices imply a 5.4 percent change in the share price following the company’s first-quarter report, due to be released after the close of trading Tuesday,” Calderone reports. “That’s slightly higher than the average move of 4.4 percent following the last eight releases. Among contracts expiring this week, 57 percent fall between strike prices of $145 to $165, with calls slightly outweighing puts.”
“Only about 6 percent of Apple’s total open interest is set to expire on Feb. 1, compared with 8 percent of the total contracts that coincided with the fourth-quarter report in November,” Calderone reports. “The relatively low open interest suggests options traders are staying on the sidelines into the release.”
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MacDailyNews Take: The fewer surprises Apple has in regard to earnings and guidance, the better.