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TheStreet Open House

Bulls Want a Piece of H&R Block

By David Russell of OptionMonster

NEW YORK --  H&R Block (HRB) has pulled back from record highs, and now the bulls are jumping in.

OptionMONSTER's tracking programs detected the purchase of almost 2,900 September 32 calls, most of which priced for $1.30. Volume was more than 55 times previous open interest at the strike, which indicates new positions were initiated.

Calls lock in the price where investors can buy shares in the tax-preparation company, letting them cheaply position for a rally. They can also generate significant leverage if the stock moves in the right direction. 

H&R Block fell 0.34% to $32.07 on Tuesday. The stock hit an all-time high of $33.65 following a strong earnings report in June, but has been sliding lower since. It's now near its 50-day moving average and the same level where it peaked in February. That could make some chart watchers think it's time to get long.

Total option volume was seven times greater than average in the session, with calls outnumbering puts by more than 70 to 1.

 

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.

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