Too Many Options: $YHOO, $MPEL, $CBS, $NS, $XOP

by Enis June 30, 2014 6:50 am • Commentary

Options volume was quite light ahead of the weekend, with most of the single stock options volume focused on Jan15 upside calls in various names.

1.  YHOO – YHOO bounced above $34 for the first time in a week, and the stock is trading near $35 in the pre-market this morning after an upgrade at Piper Jaffray.  The Jan15 40 calls traded 80k for 1.605 shortly after the morning bell.  On Friday’s Options Action Dan took a look at this activity as the floor that crossed 20,000 of the calls shortly after the open reported them as SOLD to CLOSE, but open interest increased in the line so there is a possibility that in one trade an investor was closing and in the blocks prior they were opening.  This is one of the very reasons why we don’t place a ton of stock in large block trades because unless you know exactly what the initiator is doing it can sometimes be very hard to get a clear read.

2.  MPEL – The Jan15 38 calls traded 64k for 4.30 vs. 40k of the Jan16 39.66 calls for 7.30 in the morning.  24,487 of the Jan15 49.66 calls traded for 1.40 as well a bit later,  all in the morning.  MPEL reached an all-tie high of $45.70 in March.

3.  CBS – Stock had a strong week after the Supreme Court ruled against Aereo on Wednesday (see our NTT post on Tuesday).  Buyer of 42k of the Jan15 80 calls for 0.55, looks like to close a call overwrite executed on in January.

4.  NS – Trader rolls up a call trade, selling 15k o fate Dec 60 calls at 3.30 to close, vs. buying 27,500 of the Dec 65 calls for 1.75 to open.  NS last traded above $65 in mid-2011, and its all-time high is $71.69 from December 2010.  The stock is up 21% year-to-date.

5.  XOP – Buyer of 35k of the Aug 79 puts for 1.75 to open when the etf was $81.38