This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Bulls Turn Fast Profits in ValueClick

By David Russell, reporter at OptionMonster

NEW YORK -- The bulls hit a home run in ValueClick (VCLK) Monday, using option leverage to amplify a rally in the share price.

The stock started the day quietly, opening higher by less than 1% before the buyers showed up. Early prints in the April 29 calls showed blocks pricing for $1, while the April 30s went for 80 cents. Volume was especially noteworthy at the higher strike, where more than 3,400 contracts traded against previous open interest of just 596.

The shares were up more than 6% when the calls hit and continued to work their way higher, at one point showing a gain of almost 12%. But that move was nothing compared with the options because both call contracts more than doubled in value as the stock advanced. The 29s fetched as much as $2.15, while the 30s shot up to $1.65, according to OptionMonster's tracking systems.

Because they cheaply fix an entry level on a stock, calls can generate significant leverage if investors correctly anticipate fluctuations in the share price. They can also lose most or all of their value if the move doesn't occur.

ValueClick's shares closed Monday's session at $30.12, a gain of 8.54%. The main catalyst driving the rally was an upgrade from Jefferies, which also raised its price target on the Internet-advertising company to $35 from $23.

Total option volume was 14 times greater than average, with calls accounting for more than 90% of the volume.

Russell has no positions in VCLK.
This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $94.99 -0.02%
FB $99.54 -0.21%
GOOG $678.11 -0.68%
TSLA $148.25 0.18%
YHOO $26.82 -0.85%


Chart of I:DJI
DOW 16,014.38 -12.67 -0.08%
S&P 500 1,852.21 -1.23 -0.07%
NASDAQ 4,268.7630 -14.99 -0.35%

Free Reports