Malandrino/NajarianWEBINAR: Market Momentum and Identifying Outperformers 02/20 5:30pm ET CLICK HERE FOR INVITE AND TO REGISTER.
This has been a very busy morning with the deal-related moves in H.J. Heinz (HNZ) (20%) and Constellation Brands (STZ) (34%) providing excitement for many traders despite the relatively flat overall market (SPY near unchanged).
Bullish flow, defined as unusually heavy opening out-of-the-money call buying was noted in the several stocks.
Iridium Communications (IRDM) shares are trading just below $7 and buyers are paying $0.15 for March 7.5 calls on this satellite phone company. One thousand have traded so far, and OI is only 342 so they appear to open, and with earnings at month end, the buyer may be looking for a break higher around that time. The 52-week range is $5.60 to $9.63.
Advance Auto Parts (AAP) saw March 85 call buyers for $0.50. We saw a March 80-85 call spread buyer last week, and today's buyer may be closing the short leg of that spread.
General Mills (GIS) April 45 and February 44 calls are both seeing buyers today, with the current put:call ratio near 0.05 (20 calls per put) as shares lift 2.3%, possibly helped by the jump in HNZ.
SBA Communications (SBAC), the wireless infrastructure company, saw call open interest grow by 8143 calls (and zero puts) after a buyer on Wednesday paid $0.45.
Honorable mention goes to HNZ, and while hindsight is 20-20, our bullish scan from yesterday for S&P 500 component stocks ranked HNZ seventh on the list. We were not involved, but a buyer of about 2200 June 65 calls at midday for $0.35 (when shares were near $60.80) is looking at a 20-fold gain this morning.
We are seeing defensive put buying ahead of earnings in the engineering firm KBR (KBR) today. Earnings are next week and nearly 9000 March 25 puts have traded today, most for $0.10. The buyer may be protecting gains since shares are up nearly $5 since November, but it's one to keep an eye on.
OptionsProfits can be followed on Twitter at twitter.com/OptionsProfits.
EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stocks Under $10 that he thinks could potentially double. See what he's trading today with a 14-day FREE pass.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV