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Thursday’s Vital Data: Walt Disney Co (DIS), Netflix, Inc. (NFLX) and Advanced Micro Devices, Inc. (AMD)

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U.S. stock futures are trading broadly lower once again this morning, as traders are still feeling the pinch from rising rhetoric between the U.S. and North Korea. Yesterday, the North detailed plans to strike at U.S. military bases in Guam, with one commander stating "Sound dialogue is not possible" with President Donald Trump and "only absolute force can work on him," according to North Korean state media.

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At last check, futures on the Dow Jones Industrial Average had fallen 0.25%, Nasdaq-100 futures were down 0.64% and S&P 500 futures had lost 0.41%.

On the options front, volume remained brisk and puts continued to gain favor amid rising tensions with North Korea. Overall, about 16.6 million calls and 16.5 million puts trading, resulting in a single session put/call volume ratio of 0.99. Meanwhile, the CBOE single-session equity put/call volume ratio vaulted to 0.83 - a four-month high - while the 10-day moving average hit its own four-month high of 0.70.

Turning to Wednesday's options activity, Walt Disney Co (NYSE: DIS ) reported poorly received third-quarter earnings and announced it was not renewing its content deal with Netflix, Inc. (NASDAQ: NFLX ). Puts piled up on both DIS stock and NFLX shares as a result. Meanwhile, Advanced Micro Devices, Inc. (NASDAQ: AMD ) was once again the target of a bearish research note, this time from Barclays, which called for a 30% cut in AMD's stock price.

Walt Disney Co (DIS)

Walt Disney reported that third-quarter earnings that fell 5% year-over-year to $1.58 and revenue that came in flat at $14.2 billion.

Earnings were just above the Street's targets, and sales were just below, but it was Disney's decision to dump $1.8 billion into streaming video company BAMtech to create its own online streaming service and ditch its deal with Netflix in the process. With DIS stock shedding nearly 4% on the news, investors were clearly skeptical of the move.

DIS options traders also expressed their displeasure with Disney. Volume came in at 186,000 contracts, rising to more than 600% of DIS' daily average. What's more, 54% of that activity was of the put (or bearish) variety. Looking out to September options, it appears that traders are expecting DIS to fall below the psychologically significant $100 level, as more than 20,000 put contracts have accumulated at this just out of the money strike.

A breach of $100 could confirm a bearish downtrend for DIS now that the shares have breached both their 50-day and 200-day moving averages.

Netflix, Inc. (NFLX)

While NFLX investors were concerned yesterday , the stock's rebound from its heaviest losses appeared to say that most believe Netflix would be fine without Disney. Once down more than 4%, NFLX stock fought its way back to a loss of less than 1.5% on Tuesday. The stock is currently in the process of filling in its post-earnings gap higher from July 18, and could have additional downside over the short-term as a result, however.

NFLX options traders appeared keen to this development, and it reflected in Tuesday's activity. Netflix volume rose to 128,000 contracts, nearly doubling its daily average, while puts snapped up 52% of the day's take.

Pessimism has been building on NFLX for a while among options traders, however, as the September put/call OI ratio has risen to 1.21 in the weeks since the company's quarterly report. A pullback to support near $165 and NFLX's 50-day moving average may be in order before this negativity begins to dissipate.

Advanced Micro Devices, Inc. (AMD)

There are AMD bears, and then there are ratings firms like Barclays. Specifically, Barclays reiterated its "underweight" rating and $9 price target on AMD stock yesterday, effectively calling for a roughly 30% plunge in the shares. Barclays' reasoning revolves around the decline of GPU sales driven cryptocurrency mining - especially Ethereum.

I have stated before that I believe the cryptocurrency fad is only blip in AMD's longer-term bullish outlook , and options traders appear to have adopted a similar stance on the shares. Volume rose to 182,000 contracts on AMD on Tuesday, falling just shy of doubling the stock's average daily options volume. Meanwhile, calls actually accounted for 63% of the day's take, giving the activity a bullish tilt despite the Barclays' note.

Looking out to September, we find a strong bullish contingent of options traders for AMD. Currently, the September put/call OI ratio rests at 0.51, with calls nearly doubling puts among back-month options. At last check, the most popular strike was the Sept. $14 call, which sported OI of more than 46,000 contracts.

As of this writing, Joseph Hargett did not hold a position in any of the aforementioned securities.

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The post Thursday's Vital Data: Walt Disney Co (DIS), Netflix, Inc. (NFLX) and Advanced Micro Devices, Inc. (AMD) appeared first on InvestorPlace .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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