2015-07-27 Unusual Options Activity (CAT) (TWTR)

Posted on July 27th, by Mitchell Warren in Free Articles, Options Risk Management, Smart Money Report, Unusual Options Activity. Comments Off on 2015-07-27 Unusual Options Activity (CAT) (TWTR)

Unusual Options Activity

  1. American Express (AXP)- There was a rollout from 3,260 July 31 $76 puts ($1.64 credit) into 3,260 July 31 weekly $74 puts ($0.55 debit). On July 22nd, they reported a 4% drop in Q2 revenue (worse than expected). The strong dollar is partially responsible for the weakness.
  2. Ball Corp (BLL)- 2,428 Feb 2016 $72.50 calls were purchased for $2.60 and 2,428 Sep $62.50 puts were sold for $0.90-$0.95. Over 12,000 remain in open interest in the Feb $72.50 calls from buying in recent months. They are trying to acquire Rexam (would combine the two largest can makers in the world), but there are still regulatory hurdles to overcome. Earnings are due out on July 30th.
  3. Caterpillar (CAT)- There was a rollout from 4,000 Aug 21 $76 puts ($2.00 credit) into 6,000 Sep 18 $70 puts ($0.81 credit). On July 23rd, they missed Q2 revenue estimates and lowered their FY15 guidance. CAT trades at a P/E ratio of 16.51x (2016 estimates), price to sales ratio of 0.87x, and a price to book ratio of 2.69x.
  4. NRG Energy (NRG)- Roughly 11,000 Aug $22 calls were purchased for $0.60-$0.75, against open interest of 9,260 contracts. 9,000 were bought on Friday too. Earnings are due out on August 4th. Short interest in the utility is just over 5% of the float.
  5. Twitter (TWTR)- Another 5,895 Jan 2017 $35 calls were bought for $7.75, against open interest of 64,172 contracts. Over 60,000 have been bought since June 30th. Earnings are due out tomorrow night.
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