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

Long-Term Bet on Office Depot

By David Russell of  OptionMonster

NEW YORK -- Office Depot (ODP) is up sharply this week, and the bulls are piling in for the long term.
OptionMonster's tracking systems detected the purchase of about 16,000 January 2016 5 calls for $1.25 and $1.30 on Thursday. Volume was more than 10 times the previous open interest in the strike, which indicates that new money was put to work.
These long calls lock in the price where ODP shares can be purchased, letting investors cheaply position for a rally in the next 18 months. The contracts can also generate significant leverage if the stock moves in the right direction, but they can expire worthless if shares decline.
Office Depot rose 1% to $5.05 on Thursday and is up 22% in the last week. Most of that move came after earnings and revenue beat expectations on Tuesday. The office-supply retailer also raised guidance, citing cost synergies from its acquisition of OfficeMax.
Total option volume in Office Depot Thursday was triple its daily average for the last month. Overall calls outnumbered puts by a bullish 75-to-1 ratio.
Russell has no positions in ODP.

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 $93.93 0.25%
FB $101.98 0.07%
GOOG $683.36 0.04%
TSLA $150.59 0.08%
YHOO $27.03 1.00%


Chart of I:DJI
DOW 15,953.63 +293.45 1.87%
S&P 500 1,862.48 +33.40 1.83%
NASDAQ 4,334.9560 +68.1190 1.60%

Free Reports