Bulls Snap Up Callaway Golf Options

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

Mike Yamamoto, managing editor for OptionMonster.

CARLSBAD, Calif. (TheStreet) -- Bullish traders are driving Callaway Golf(ELY Quote) higher today along with strong options activity.

Callaway Golf is up 6% to $7.95 this afternoon after getting an upgrade to "outperform" from Wedbush Morgan Securities, which raised its price target to $10. The stock is well below its high of $15.45 from exactly a year ago but has rallied back sharply from its $4.77 low of early July.

Today's option trading is decidedly bullish, with almost all of it taking place at in the November 10 calls. Nearly 2,200 calls changed hands at the strike, dwarfing the open interest of 47 contracts and zero average daily volume.

Most of the calls traded in a strong buying pattern for 15 cents to 25 cents, according to OptionMonster's real-time tracking systems. For those options to turn a profit before they expire in mid-November, the stock will need to rise at least 28%.

The golf company is scheduled to report quarterly earnings on Oct. 29. The Callaway Golf Pebble Beach Invitational tournament is scheduled to begin on Nov. 18, two days before the options expire.

Total call volume outnumber puts by more than 7 to 1, indicating the overall bullish sentiment in the stock.

-- Reported by Mike Yamamoto of OptionMonster in New York.

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