Bullish Options Activity in American Tower

By Jud Pyle, CFA, chief investment strategist for the Options News Network

American Tower (AMT Quote) shares closed down 56 cents to $37.17 on Tuesday, following news that the company plans to offer fixed rate senior unsecured notes due by 2015 in order to repay outstanding debts. Despite the stock slide, at least one investor expressed some bullish sentiment using a bull synthetic.

The investor sold 7,500 Jan. 11 35 puts for around $4.28 to finance a purchase of 7,500 Jan. 11 40 calls for around $4.60 per contract. The Jan. 11 35 puts dropped 10 cents on the day and are home to open interest of just 202 contracts. The Jan. 11 40 calls closed down 20 cents and are home to open interest of 900 contracts. The Jan. 11 35 puts have a delta of 35 and the Jan. 40 calls have a delta of 50.

It's interesting that we're seeing moderately bullish activity in AMT, whose shares are up 16% since a recent low at the beginning of September. The investor in question is not only long calls in the stock, but also sold puts to gain further long exposure to AMT.

Jud Pyle is the chief investment strategist for Options News Network and the portfolio manager of TheStreet.com Options Alerts. Click here for a free trial for Options Alerts. Mr. Pyle writes regularly about options investing for TheStreet.com.