Semiconductor Stocks Face Key Earnings Tests This Week
Hızlı Bakış
- Semiconductor companies Cerebras and Micron are set to report earnings this week, providing crucial insights into the sector's performance.
- Cerebras, a recent IPO, faces investor scrutiny after a significant stock drop, while Micron's report is a key test for memory chip stocks, which have seen explosive growth driven by options market activity.
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The semiconductor sector is central to the current bull market. Key companies like Cerebras and Micron are reporting earnings this week, with significant options market activity indicating anticipated volatility.
After an up-and-down week for stocks around SpaceX and Federal Reserve chairman Kevin Warsh's debut, investors will get a fresh read on the pulse of the sector still at the heart of the bull market: semiconductors.
On Tuesday, AI chipmaker Cerebras will report earnings after the bell – the company's first since going public last month. The stock's down almost 30% from its first day of trading and options prices imply a 11.5% move after its report.
On Wednesday, it's Micron reporting, a key test for the stock that's been symbolic of the explosive move higher in memory names that's been powered by expensive call-buying in the options market.
Micron implied volatility sits at 116, the highest in the S&P 500 alongside Sandisk and Western Digital . Traders anticipate a 10% swing, the biggest implied move for earnings since December 2024.
The stock added almost 6% Monday to as high as $1204 per share, bringing its year-to-date move to 280 percent.
Options volumes in Micron were balanced on Monday with about as many calls trading as puts, but call premiums accounted for $2.6 billion of the $3.3 billion in options traded, according to SpotGamma.
The biggest single call contract traded in the market Monday was a $61 million purchase of 800 of the the 430-strike Micron call expiring July 17, a deep in-the-money bullish position that trades similarly to being long stock. With implied volatility so high in Micron, in-the-money contracts will be less susceptible to the drop in volatility that's standard after an earnings event.
To be sure, there is also a lot of call selling happening in Micron, as well as the record-breaking Roundhill Memory ETF (DRAM) , where 34,000 calls were sold Monday, compared to just under 20,000 bought, according to data from ThinkOrSwim.
For perhaps the most bullish options positioning around AI, traders may want to watch Super Micro Computer – the stock's up 16% after the company announced a new data center blueprint using Nvidia architecture and bulls are piling into calls.
More than 320,000 calls traded in SMCI, compared to just 64,000 puts, and traders bought almost 10 times more calls than they did puts, according to ThinkOrSwim. The most popular contract by volume as of writing is the 40-strike call expiring Friday, with more than 24,000 contracts traded, according to SpotGamma.
Açık Sorular
- Will Cerebras's first earnings report meet expectations?
- How will Micron's earnings impact the memory chip sector?
- Can Super Micro Computer sustain its bullish momentum?
