Bulls Bet EnerNoc Will Power Higher

 
 
By David Russell of OptionMonster
 
NEW YORK -- EnerNoc (ENOC) bounced after a strong earnings report on Nov. 7, and the bulls came back last week.
 
OptionMonster's trade scanners detected the purchase of almost 3,500 December 20 calls for 30 cents to 45 cents on Friday. Volume was nine times the previous open interest at the strike, indicating that new money was put to work.
 
These calls lock in the price where shares can be purchased, letting investors cheaply position for a rally. They can also generate significant leverage because a gain of about 12% in the stock will more than double the value of those December 20 contracts.
 
EnerNoc shares rose 8.34% to $18.70 on Friday. The provider of energy-management applications for the smart grid is expected to grow revenue 38% this year and 17% in 2014 as utilities look to increase efficiency. RW Baird raised its price target on the stock to $24 from $21 on Nov. 8.
 
Overall option volume was 20 times greater than average in the name, with calls accounting for a bullish 92% of the total.
 
Russell has no positions in ENOC.

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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