Today's column includes the latest quarterly results from China Green Agriculture, Inc. (CGA), a prolonged tender offer from Green Mountain Coffee Roasters Inc. (GMCR), regulatory troubles for Cell Therapeutics, Inc. (CTIC), and a negative write-up on Under Armour, Inc. (UA). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd.
China Green Agriculture, Inc.
China Green Agriculture, Inc. (CGA: sentiment, chart, options) reported this morning that it swung to a fiscal second-quarter profit of $4.7 million, or 20 cents per share, up 78% from the year-ago period. Sales for the quarter surged 60% to $11.2 million, as gross margin increased to 61% from 59% during the second quarter of 2009. Analysts, on average, were looking for a per-share profit of 19 cents on $11 million in sales. Looking ahead, CGA hiked its fiscal 2010 earnings guidance to $20.3 million, or 87 cents per share, on revenue of $48.9 million.
"Rising demand for our green fertilizer products coupled with our growing nationwide distribution network should allow us to experience robust revenue and earnings growth for the remainder of the year as we build on being one of the leading organic compound fertilizer producers in China," noted Tao Li, the company's chairman, president, and CEO.
CGA is up 4.7% in pre-market trading, with the shares bouncing off support at their 32-week moving average. The stock is now poised to open north of its 20-week trendline, which has helped to guide CGA higher since March 2009.
Ahead of today's earnings report, option players appeared to be bracing for an upside surprise. During the past 10 days, traders on the International Securities Exchange (ISE) bought to open 13.1 times more calls than puts on CGA. However, with a substantial 23.6% of the equity's float sold short, there's a good chance that some of these calls were purchased to hedge short stock positions.
Green Mountain Coffee Roasters Inc.
Green Mountain Coffee Roasters Inc. (GMCR: sentiment, chart, options) said today it has extended its tender offer to acquire Diedrich Coffee (DDRX). The offer has been extended 20 business days to March 8, 2010, unless further extended, and all other terms and conditions of the offer remain unchanged. As of 4:30 p.m. on Feb. 5 -- the original expiration date -- roughly 2.32 million shares had been tendered into the offer and not withdrawn.
GMCR is up nearly 3% ahead of the bell, adding to its 52-week ascent of roughly 200%. The shares are now in position to reclaim a foothold atop tenuous support at their 10-day and 20-day moving averages.
Meanwhile, front-month bulls are betting GMCR will keep climbing during the short term. Peak call open interest of 11,998 contracts lies at the February 90 strike, which is currently out of the money by a healthy margin.
Cell Therapeutics, Inc.
The U.S. Food & Drug Administration (FDA) seems none too impressed with pixantrone, the experimental lymphoma drug from Cell Therapeutics, Inc. (CTIC: sentiment, chart, options). In documents released today, the FDA cited numerous safety and efficacy issues, including "substantial hematologic and cardiac toxicity," as well as light enrollment in a phase 3 lymphoma study. The drug will face the further scrutiny of an FDA advisory panel on Wednesday.
CTIC has plunged 18% to trade at 87 cents per share in electronic action, extending its year-to-date deficit of 7%. Unless the shares snap back in short order, they'll likely violate short-term support at 90 cents with the sound of today's opening bell.
The stock's dive into penny-stock territory will no doubt please some bearish bettors, who have stacked up a hefty accumulation of puts at CTIC's February 1 strike. This soon-to-be in-the-money strike is home to peak open interest for the February series, with 100,457 contracts outstanding.
Under Armour, Inc.
Under Armour, Inc. (UA: sentiment, chart, options) was the target of a downbeat Barron's piece over the weekend, with the financial publication arguing that "shares of... the hot sports-apparel maker have gotten way ahead of themselves." As points of concern, the author cites slowing profit growth, "an unprecedented misstep on its latest footwear rollout," and its lofty valuation -- UA trades at roughly "23.7 times 2010 earnings."
UA is brushing off this negative commentary ahead of the open, adding 3.3% in electronic trading. However, any positive momentum could be short-lived, with UA staring up at short-term resistance from its 10-day and 20-day moving averages.
Meanwhile, an unwinding of bullish sentiment among option traders could further stymie the stock's early rally attempts. UA's Schaeffer's put/call open interest ratio (SOIR) arrived today at a new annual nadir of 0.70, revealing that short-term speculators are more optimistically aligned toward the shares now than at any other time during the past year.
Discuss this article:
Post your own comment
More articles:
Today's column includes takeover talk for Burger King Holdings, Inc. (BKC), a bullish brokerage note for CIT Group Inc. (CIT), an upgrade for Massey Energy Company (MEE), and a potential Norwegian suitor for Transocean Ltd. (RIG). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
Today's column includes merger-and-acquisition rumors for Saks Incorporated (SKS), soft guidance from Monsanto Company (MON), a courtroom victory for TASER International, Inc. (TASR), and a pair of bullish brokerage notes for Seattle Genetics, Inc. (SGEN). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
Today's column includes a harshly rejected buyout bid for Genzyme Corporation (GENZ), new stock buyback plans from Fossil, Inc. (FOSL), a downgrade for Lululemon Athletica Inc. (LULU), and a slew of new government-sponsored solar projects for SunPower Corporation (SPWRA). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
Today's column includes yet another Dreamliner delay from The Boeing Company (BA), mixed quarterly results from OmniVision Technologies, Inc. (OVTI), a potential overseas acquisition for State Street Corporation (STT), and confirmation on an iron ore price cut from Vale S.A. (VALE). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
Today's column includes an upbeat outlook from Cyberonics, Inc. (CYBX), a new iPhone app from Netflix, Inc. (NFLX), the latest Macau results from Las Vegas Sands Corp. (LVS), and a gloomy forecast from GigaMedia Limited (GIGM). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
Today's column includes a new debt buyback plan from Delta Air Lines, Inc. (DAL), an upgrade for Intuitive Surgical, Inc. (ISRG), rumored TV deals -- and a bullish iPad forecast -- for Apple Inc. (AAPL), and hot-and-cold analyst notes for Trina Solar Limited (TSL). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
Today's column includes the latest quarterly results from Barnes & Noble, Inc. (BKS), a bullish brokerage note for Isle of Capri Casinos (ISLE), a federal safety violation at Massey Energy Company (MEE), and upbeat analyst attention for Urban Outfitters, Inc. (URBN). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
Today's column includes acquisition news from World Fuel Services Corporation (INT), a bullish brokerage note for beaten-down Bank of America Corporation (BAC), an FDA rejection for Jazz Pharmaceuticals, Inc. (JAZZ), and a newly trimmed price target for Research In Motion Limited (RIMM). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
Today's column includes a potentially hefty fine for AMR Corporation (AMR), a long-awaited first-quarter earnings report from Canadian Solar Inc. (CSIQ), robust Macau results for Wynn Resorts, Limited (WYNN), and a negative analyst note for Yahoo! Inc. (YHOO). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
Today's column includes a potential bond sale for American International Group, Inc. (AIG), a new acquisition for MasterCard Incorporated (MA), an increased buyback plan for RadioShack Corporation (RSH), and a bullish brokerage note for Sirius XM Radio Inc. (SIRI). Each day, Early Edge focuses on the hot stocks in the news and gives you a unique insight into each stock's sentiment backdrop. Our time-tested contrarian approach centers on options, and gives you the trading tools to approach the day with a much-needed edge over the investing herd. read more...
working... 
