By Jud Pyle, CFA, chief investment strategist for the Options News NetworkShares of Cigna ( CI) are up more than 2% so far today to $21.30. The company is set to announce earnings before the market opens on Thursday, April 30, and at least one investor is bullish, expecting a potential bump in the stock. This investor has been active today at the May 25 call strike. Looking at these back-month options, we find that more than 10,000 had traded in the first hour of trading this morning. Open interest in these calls was just 2,607, according to the Sidewinder report at www.ONN.tv.
Call-buying like this does not mean investors should run out and buy shares. But it is worth noting that there are potentially two catalysts to make the stock jump: a potential takeover or a positive earnings announcement. Jud Pyle is the chief investment strategist for Options News Network (www.ONN.tv) 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.