Options Traders Bullish on Cisco

Pete Najarian, co-founder of OptionMonster

Options traders were bullish on Cisco Systems (CSCO Quote) Thursday, apparently in early speculation over the networking technology giant's earnings report next month.

Trading was concentrated on the Aug. 19 calls, in which 24,780 contracts changed hands in a strong buying pattern at more than double the open interest. On an average day, only 1,074 calls have traded at that strike in the last month.

In other seemingly bullish options activity, puts were sold in large numbers at the July 18 and Aug. 18 strikes in what may be an indication that traders are no longer worried Cisco shares will fall in the next month or so.

The stock ended Thursday's regular session up 0.2% to $18.17 and inched up to $18.25 in after-hours trading. Cisco has rebounded from its 52-week low of $13.61 on March 9, but has encountered technical resistance around the $20 twice since then.

Cisco on Thursday announced a partnership with UnitedHealth(UNH Quote) on a major health care initiative designed to "expand physicians' reach into both rural and other underserved areas and to help mitigate disparities in health care delivery."

That program is scheduled to be unveiled before federal legislators in Washington next Wednesday.

Cisco is expected to report quarterly earnings on Aug. 4.