CHICAGO ( TheStreet) -- Option activity volume in Hefty Allergan ( AGN) changed hands during trading Monday morning thanks to an investor who likely expressed bullishness buying out-of-the-money calls.

AGN shares dropped 21 cents to $62.10 during midday trading, but are currently up 49 cents to $62.80. The company has not announced its next earnings release date, but the market expects the report sometime around April 29. AGN reached a 52-week high of $64 in December, and call-buying action suggests at least one investor is calling for new highs throughout the longer-term.

Around 11:24 a.m. EST, more than 10,000 out-of-the-money January 2011 65 calls hit the tape at the ask price of $4.60 per contract, suggesting investors bought these calls on a bet that the stock could climb higher than $69.60 prior to options expiration next January.

Implied volatility of these calls is 25%, compared to a 30-day historical volatility of 17%. The heavy call-buying action has pushed up the implied volatility levels on the day, and also contributed to the 10-cent appreciation in these options. That's right, the options are higher despite the stock being lower. Additionally, these calls are home to current open interest of 6,200 contracts, indicating investors opened long positions.

This options action suggests bullish investors who bought these calls anticipate at least 12% upside throughout the next nine months. Also, keep in mind that AGN has not breached the $69 mark throughout the last five years, but one investor seems to think the stock could experience significant upside. If the stock pops up significantly before the options expire, investors could choose to sell back these calls and book profits instead of unnecessarily holding onto them.

-- Written by Jud Pyle in Chicago
At the time of publication, Pyle did not have a position in the stock mentioned. Jud Pyle, CFA, is the chief investment strategist for Options News Network. Pyle started his career in finance in 1994 as a derivative analyst with SBC Warburg. After four years with Warburg, Pyle joined PEAK6 Investments, L.P., in 1998 as an equity options trader and as chief risk officer. A native of Minneapolis, Pyle received his bachelor's degree in economics and history from Colgate University in 1994. As a trader, Pyle traded on average over 5,000 contracts per day, and over 1.2 million contracts per year. He also built the stock group for all PEAK6 Investments, L.P. hedging, which currently trades on average over 5 million shares per day, and over 1 billion shares per year. Further, from 2004-06, he managed the trading and risk management for PEAK6 Investments L.P.'s lead market-maker operation on the former PCX exchange, which traded more than 10,000 contracts per day. Pyle is the "Mad About Options" resident expert. He is also a regular contributor to "Options Physics."