Today’s tickers: OSTK, COF & OSIS
OSTK - Overstock.com, Inc. – Shares in Overstock.com, Inc. are spiking for a second-consecutive session, helped higher today by an upgrade to ‘buy’ from ‘underperform’ at Bank of America-Merrill Lynch. The off-price online retailer rallied 22% to $19.25 this morning, adding to the 36% increase in the price of the underlying during Thursday’s trading session following the company’s better-than-expected first-quarter earnings report released ahead of the open yesterday. Options changing hands on Overstock.com indicate some traders are positioning for shares to extend gains in the near term. Upwards of 1,500 calls have traded at the May $20 strike versus zero open interest, with much of the volume purchased in the early going at an average premium of $0.48 apiece. Call buyers stand ready to profit at expiration should shares in OSTK settle above the average breakeven price of $20.48. Fresh interest is also on the rise in the $20 strike call options expiring in June and September. Positions established in the April $15 strike call and put options yesterday are generating profits for some options players today. Open interest in the $15 strike puts jumped by around 860 contracts overnight, and a review of Thursday’s trading activity indicates most of the puts were sold at a premium of $0.30 each. The puts are now far out-of-the-money, suggesting put sellers are likely to walk away with the full amount of premium received at expiration. Finally, April $15 strike calls purchased yesterday at $0.24 each are today changing hands at $3.90 apiece as of the time of this writing.
COF - Capital One Financial Corp. – Trading traffic in weekly call options on Capital One suggests one or more traders are gearing up for shares in the name to extend gains in the near term. Shares in COF are up more than 6.0% in early afternoon trading to stand at $56.10 after the company reported first-quarter earnings that exceeded analyst expectations following the close of trading on Thursday. Upside call buying in the weeklys…
