Apple Inc. (NASDAQ:AAPL) apparently is not the only company that is benefiting from the ongoing debate about strong demand for iPhone 6. There is already speculation on Wall Street that NXP Semiconductors NV (NASDAQ:NXPI) could register an impressive rally in the market when it posts its quarterly earnings. CNBC’s, Michael Khouw, notes that the Option’s market remains bullish on the NXPI moving by 7% on earnings.
“There was a lot of Puts that have been trading ever since the stock had its strong rally over those October lows starting in December and through January. This could have been one institution looking to adjust that position a little bit. Right now, the options market is looking for a move of about 7%, and that is surprising for a stock trading at a low multiple. That has averaged less than 4% move typically on earnings,” said Mr. Khouw.
NXP Semiconductors NV (NASDAQ:NXPI) has continued to soar in the market at the back of its business model of providing high performance and standard solutions for radio frequency. There is belief that as Apple Pay becomes more integrated into financial transactions more clients may come in calling for secure payment solutions. NXP Semiconductors NV (NASDAQ:NXPI) has a wide exposure, with its solutions highly integrated in cars security systems as well as credit cards.
Khouw notes that the Apple Inc. (NASDAQ:AAPL)’s supplier Put traded volume have been surging in the recent trading session heading into the earnings report.
“We saw more than six times the average daily put volume in NXP Semiconductors NV (NASDAQ:NXPI) and that was entirely the result of a substantial Put Butterfly that traded specifically the February $77.5/70/65 Put Fly. […] When you trade a butterfly exactly what you are looking for is the stock to migrate to that Middle strike that short strike that would be $70,” said Mr. Khouw
Pete Najarian on the other hand expects most of the Put volume to be traded at around $70 on expectation of the company posting positive numbers for the quarter.
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