Bullish Traders Jump on Zoltek Options

OptionMonster co-founder Pete Najarian provides options picks Monday, Wednesday and Friday in TheStreet.com's Deep in the Money Calls newsletter.

David Russell, reporter for OptionMonster.

Stock and options trading turned bullish on Zoltek(ZOLT Quote) today as investors piled into the specialty-chemical producer.

Volume in the June 10 calls has leapt past 4,500 against open interest of 2,199 contracts, according to OptionMonster's monitoring systems. A single purchase of 4,260 calls at $1.30 accounted for the bulk of the activity.

Zoltek, which is up 13% this afternoon to $11.22, has risen more than 33% in the last month. The company, which makes carbon fibers for aircraft brakes and industrial applications including wind energy and deep-sea drilling, reported worse-than-expected second-quarter results on May 11. The last piece of news on the company was a stock purchase by its chief financial officer on May 18.

Today's large transaction in the June 10 calls came less than a minute after 4,260 June 7.50 calls changed hands for $3.20 against open interest of more than 5,000 contracts. While it might appear that someone rolled a position in the lower-strike calls to a higher strike, the trade was executed above the asking price of $3.10, suggesting that it was a purchase rather than a sale.

It won't be possible to know for sure until open interest figures are published after the close. Calls in Zoltek outnumbered puts by 6 to 1 today, reflecting the broadly bullish sentiment.