We talked about “Expiration Week Earnings Plays” in this week’s webinar (you can access an archived version from this link or peruse our webinar archive page). During the session, we highlighted what the option market was projecting about the expected move in companies such as JPMorgan Chase (JPM) and Google (GOOG).
At the time of the webinar (after Tuesday’s close), at-the-money straddles were indicating a 3.2% move in JPM and a 4.4% move in Google through today’s expiration. Remember a straddle is the simultaneous purchase (or sale) of the call and put with the same strikes (and same expiration). Adding the at-the-money call and put prices together is a reasonable reflection of the option market’s expected move for the underlying through the next expiration date at any given time. (more…)
The recall drama isn’t over for Toyota Motor (NYSE:TM), which last week announced the recall of 1.1 million 2008 Corolla and Matrix vehicles, citing engine control troubles. The potential flaw may result in stalling, which is ironic given that the automaker’s recent high-profile recall dealt with unwanted acceleration.
The Hotlist, which scans unusual option volume during the trading day, is available to all OptionsHouse customers, including those with a 
Everyone’s favorite bullseye-themed discount store, Target Corporation (NYSE:TGT), has been in a short-term slump. From its August 9 high of $53.70, the shares have retreated nearly 7%. This decline has brought the shares below its 50-day and 200-day simple moving averages, which themselves are now in the process of crossing bearishly. + of 2% to 4%. Things could be looking up, however, as the company reported second-quarter earnings this morning. Profit rose 14% as cost cutting helped offset the disappointing same-store sales growth. Target earned 92 cents per share, matching estimates.
Texas Instruments (NYSE:TXN) dipped into the red yesterday after its second-quarter earnings report failed to impress. The technology company reported per-share earnings of 62 cents per share, more than triple year-ago results and in line with analysts’ expectations (but reportedly below the “whisper number”). Revenue, meanwhile, hit $3.5 billion, narrowly missing the consensus view of $3.52 billion.
Earnings are typically perceived as volatile events since they are often a catalyst for a stock to move higher or lower in a dramatic way. Even though earnings can be volatile, they don’t always have to be and sometimes the announcements do little to create market movement.
