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IBDvalueinvestin (98.50)

Major volume in DLB Feb. $25 PUTS



February 04, 2009 – Comments (4) | RELATED TICKERS: DLB

5,861 volume compared to only 2,881 open interest. Contrarian indicator would mean that DLB would beat estimates with so much PUT buying.


Other news of importance: 

12:22  Increase in NIH funding likely to benefit ILMN, LIFE, TECH and TMO - Leerink Swann
Leerink Swann notes that yesterday the Senate voted in favor of an amendment to the Stimulus bill that would potentially increase NIH funding by $6.5 bln and $10 bln over 2 years, well above the $1.5 bln increase that the firm had previously gathered from MEDACorp consultants. While the firm notes that exact dollar benefit to LST spending from increased NIH funding is difficult to track, they believe that roughly 60c on the dollar can make it into spending on products and services with the balance going to pay for jobs and related infrastructure. The firm believes that ILMN, LIFE, TECH, and TMO are LST names in their universe that should benefit the most from this news. Importantly, the firm doesn't think this type of NIH budget increase is factored into current or updated FY09 guidance currently being offered by LST management teams during 4Q earnings season.


4 Comments – Post Your Own

#1) On February 04, 2009 at 1:45 PM, goldminingXpert (28.70) wrote:

Generally option buyers are pretty smart, more often than not, big put volume means the bears know something--just as big short interest eventually leads to collapsed stock price after a few nasty short squeezes first.

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#2) On February 04, 2009 at 1:51 PM, IBDvalueinvestin (98.50) wrote:

we will see if they are right or wrong on DLB which has always beat estimates by a wide margin.

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#3) On February 04, 2009 at 4:14 PM, IBDvalueinvestin (98.50) wrote:

Somuch for PUT buyers being smart, DLB beats by .13, that basically will make the DLB FEB. $25 PUT worthless.

DLB has been beaten down far too low for a Top Notch Tech stock that consistantly beats estimates. Back to $30+ in the Morning.

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#4) On February 05, 2009 at 4:11 PM, goldminingXpert (28.70) wrote:

yeah, the put buyers screwed up on this one.

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