2014-06-25 Smart Money Report (MPC) (NAT)


Posted on June 25th, by Mitchell Warren in Free Articles, Options Risk Management, Smart Money Report, Unusual Options Activity. Comments Off on 2014-06-25 Smart Money Report (MPC) (NAT)

Smart Money Report

  1. FB- A rollout from 20,000 July 19 $65 calls (credit) into 60,000 July 19 $70 calls (debit). Volume was below the open interest in both options. I still look for Facebook to complete the measured move to $72 soon.
  2. MPC- 4,500 Oct. $90 calls were purchased for $1.80 each, against open interest of 879 contracts. The call to put ratio is 2:1. Call activity is over 4x the average daily volume. Net call premium is +$599K vs. net put premium of +$311K. Implied volatility rose 20.3% to 29.91. The stock broke through the 200-day SMA, but has support at the $80 level. Marathon Petroleum trades at a P/E ratio of 7.83x (2015 estimates) with 20% EPS growth, -1.1% revenue growth (-6.6% this year), P/S ratio of 0.27x, 2.09% dividend yield, and has an average analyst price target of $105. There news that the Obama administration has paved the way for exports of unrefined oil (1st time in 40 years) today.
  3. NAT- Over 4,000 July $10 calls have traded today with the majority being purchased for $0.15 each, against open interest of 2,869 contracts. There was large call buying in (TNK) earlier this week too.
  4. SIRI- Over 65,000 Dec. $3.50 calls were sold for $0.21 each, against open interest of 104,317 contracts. Earnings are due out on 7/24. There was large selling in these calls on 6/10 and 6/12 for $0.23.
  5. TRN- Sizable buying in the July and Oct. $42.50 calls this morning. Implied volatility rose 5.8% to 29.79. The call to put ratio is 5:1. The long-term and intermediate-term uptrends remain intact. (TRN) trades at a P/E ratio of 12.57x (2015 estimates), -7.8% EPS growth (+59.8% this year), -0.4% revenue growth (+28.1% this year), P/S ratio of 1.32x, 0.93% dividend yield, and has an average analyst price target of $44.25. On 6/16, KeyBanc maintained a buy rating with a $105 price target.

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