Intel Corp (INTC)

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3:35 PM ET
Intel Earnings: Options Market Skeptical
By Tiernan Ray
The options market is flashing a cautious signal on Intel (INTC) a day before the chipmaker reports first-quarter earnings.

Over the past 10 days, investors have aggressively sold April $26 calls in anticipation the stock, recently around $26, does not rally higher toward January’s 52-week high of $27.12. The trading action likely reflects concerns about computer sales, and economic growth.

Of the 114,755 April $26 calls that have traded in the past two weeks, 53% were sold on the bid, compared to 33% bought on the ask. This indicates pessimism. Similarly, Intel’s April $26 put, the second most active contract over the past two weeks, was primarily bought by investors. Of the 65,142 contracts traded, 47% traded on the ask, and 20% received a mid-market execution.

You can tell investors are buying or selling securities by looking at where securities are bought and sold in relation to the “spread,” or the difference between the bid and ask. Orders that execute on the ask are considered buys, as are mid-market executions between the bid and ask. Mid-market executions tend to be reserved for institutional investors. Orders executed on the bid are considered sales.

Intel is expected to report earnings of 37 cents a share, on revenue of $12.8 billion.

Intel shares today are up 34 cents, or 1.3%, at $26.52.