Archive 2013
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June-Daily Freebies

June 24th
Akamai (AKAM) trading 4,487 puts, 71% on offer, with Aug. and Nov. $30 put buyers active

Ariba (ARBA) is trading 10X daily put volume as the July $35/$30 put spread is bought 1,000X, potentially a roll of a position to have the higher Delta trade.

SanDisk (SNDK) near major breakdown and more than 4,000 Aug. 39 puts trading, and total put volume of 10,250 running more than daily average less than half way through the session. Shares are lower after a terrible report from Micron (MU) last night. There are also buyers in July $41 and $40 puts, each more than 1,000 trading. Shares are nearing a break of major support from March and November, which measures a move to $30. SanDisk trades with DRAM as a commodity, and pricing remains weak. Shares trade as a value at 8.7X earnings, 0.64 PEG, 2X sales and 7.33X cash flow, and also with strong growth. Shares are also loved on Wall Street with $60+ targets at shops like Morgan Stanley, UBS and Stifel. Although tablets and Smartphones are strong, the growth is not as fast, and PC weakness will continue to hurt demand for DRAM and NAND memory.


June 23rd
Pandora (P) options newly listed and volatility buyers for 2,650 July $16 straddles, a bearish bias

Cummins (CMI) traded 3,000 January $85 puts at $7.50, tied to 93,000 shares of stock, Delta Neutral

Avon Products (AVP) nearing a breakdown and 2,800 July $26 puts bought on the offer to open, follows up some recent put buying in the name also.


Coach (COH) implied volatility rockets with the IV30 up 10% as more than 6,000 July $57.50 puts are bought to open at $0.80 on the offer, puts trading more than 3X daily average. Shares have held strong above the $58 prior breakout, forming a new base, but the recent weak push is rolling over and the momentum trends are bearish, so we could see shares roll over and head back near $55 near term. The hot apparel Co. with a $17.8B market cap trades 21X trailing earnings, 4.4X sales and 24.8X cash flow, rich considering weak retail spending starting to hit overseas where it does much of its business. The recent Prada IPO was not well received, another sign of caution. Barclays raised its target to $70 on June 9th.


June 22nd
Fastenal (FAST) ripping intraday and trading 4,850 calls, 5X daily average with buyers in July and August $35s. Earnings are expected in July expiration and shares are breaking out today to new highs. Fastenal has 8.5% of the float short, 13.2 days to cover, closely tied to the construction industry.

Tyson Foods (TSN) with 7,500 August $20 calls bought to open at $0.35, trading 4X daily call volume

CVS Corp (CVS) with a sale of 3,400 January 2012 $30 puts that looks to then have been rolled to 5,000 January $39/$34 bull risk reversals

Norfolk Southern (NSC) multi-exchange sweep for more than 3,000 July $75 calls at $0.80 to open, as Rail stocks are all trading near new highs, remaining strong on a hopeful recovery in housing, and strong demand for Coal. Norfolk Southern is still housing some bullish open interest in September calls, and shares defended its 50 EMA and gap recently, now near a break to new highs. Shares are near a break of a bull flag on the weekly, and a very bullish ADX trend. Shares of the $25.85B rail trade 13X earnings, 2.6X sales and 2.44X book, coming off a record quarter. Rail Traffic recently rebounded to the highest level in 10 weeks. A June 9th note from Deutsche Bank reiterated a Buy and $79 target, citing managements strong outlook for growth prospects, and productivity and pricing benefits.


June 21st
Limited (LTD) July $38 calls with more than 2,500 bought to open on a WSJ Blog saying that Victoria Secret could attract LBO Interest

Chevron (CVX) September collars active, the $110/$90 traded 3,500X and the $115/$90 traded 2,500X, both tied to stock buys

Lyondell (LYB) trading 3X daily call volume as 6,500 September $40 calls are rolled back to $39 strike

Tempur Pedic (TPX) seeing unusual action today with put volume 4X average as the August $75 deep ITM puts are bought for 3,196 contracts, traders paying $11.30 to $11.60 on the puts. On June 16th a trader rolled 5,000 December $70 puts down and back to the September $60 puts, while on May 5th there was a purchase of 5,000 September $65 puts. Tempur Pedic shares touched near all time highs today, although bearish divergence with MACD and RSI not making highs. At 26X trailing earnings, 3.7X sales and 22.25X cash flow, shares of the bedding maker appear rich on valuation, although impressive 28.5% Q/Q sales growth. In early April Stifel raised its target to $66, Longbow to $65, and Barclays to $60, so shares have already exceeded most Analyst targets.


June 20th
Hansen Natural (HANS) near break to new highs and December $80, $85, and $90 calls even seeing buyers, call volume 2X daily in first 10 minutes, and 80% on offer

Adobe (ADBE) with 5,900 July $32 puts bought into earnings on June 21

Under Armour (UA) great push through 70 and a buyer comes in for 500 October $72.50 calls at $6.40, high $ trade

Union Pacific (UNP) put volume is above 9,000 which is nearly 3X daily average, with the July $105/$100 put spreads bought 4,000X today, potential roll to the higher strike for a better Delta bearish trade. A few of the rails like CSX Corp (CSX) and Kansas City Southern (KSU) are starting to form bullish charts, but Union Pacific looks to have topped out with a head and shoulders top, the neckline at $98.50 which is also the prior breakout level. The recent bounce looks to be nothing more than a relief rally with RSI and MACD now running back into a downtrend resistance. A move back towards $95 could be in the cards for the Company, with rails yet to see the weakness that commodities have, and generally closely tied to commodities, and also a weak housing market and struggling consumer. Union Pacific shares trade 17.2X earnings, 2.8X sales and 2.7X book value. Bernstein initiated rails in late May with Union Pacific as its top pick, noting the best pricing and productivity story. However, Union Pacific generally moves in the direction of Coal (KOL) and with shares barely off all time highs, shares have room to pullback.


June 17th
Veeco (VECO) falling with 2,100 July $52.50 puts bought to open

Flextronic (FLEX) opening buyer of 5,000 October $7 calls at $0.30, shares filling last Octobers gap today

Q-Logic (QLGC) January $17.50 calls with a block of 10,000 traded at $0.80, shares near new lows today

United Tech (UTX) is trading 13,000 calls on the day which is 2X average with 4,698 July $85 calls and 3,600 July $87.50 calls, 30 day volatility up 7% and $308,000 in net call premium purchased, bullish action. United tech filled its prior earnings gap and based at $82.50, and now is trending higher on strong volume with bullish RSI and MACD. Defense stocks have been acting well the last few days, one of the groups outperforming. Shares of the $77B Company trade 13.7X earnings, 1.4X sales and 3.5X book with a 2.3% dividend. UBS reiterated Buy on May 11th and raised its target to $101. On Thursday the Company noted it sees no slowdown in China and has seen strong Q2 orders. Deutsche Bank reiterated Buy with a 95 target this morning, noting strong business across all groups.


June 16th
Qualcomm (QCOM) large October $57.50/$45 collar for 15,000X trades on a massive block of shares

Cisco (CSCO) January 2013 $20/$10 bull risk reversal trades 10,000X at $0.23, long term view, but fairly low risk, willing to be long 1M shares at $9.77 cost basis, which would make Cisco incredibly cheap

Medivation (MDVN) monthly call roll, this time the 19,800 June 7s rolled to July 13s

Research in Motion (RIMM) is trading 120,000 calls and 130,000 puts into much anticipated earnings after the close, mixed between bid and offer on both sides, but a negative 337K Net Delta and $512,000 in put premium bought, while $86,000 in call premium sold, so a bearish bias in both indicators. Large trades on the day include a buyer of 5,000 June $30 puts at $0.32, a buyer of 4,500 June $37.50/$32.50 strangles at $1.35, the January $45/$30 bull risk reversal at a $0.60 credit for 2,000X, and a buyer of 1,200 July $32.50/$30 put spreads at $0.65. The IV skew has a fairly normal pattern, not much of a bullish bias. June IV at 188.3% compares to July at 66% and options pricing in nearly a 10% move for shares on earnings. Shares are sitting on major support into earnings at $35, and a move below would likely target $30. Shares are now trading 5.3X earnings, 0.54 PEG, 0.93X sales and 7.65X cash flow, very cheap, and the Company has already slashed estimates over the past few weeks, so it does appear volatility may be over-priced as the report should offer few surprises. Avian raised shares to Positive ahead of the report today, and JPM cut its target to $40.50 yesterday. The smart money in this name with massive put positions have recently been rolling to lower strikes, maintaining a bearish bias, seeing the name as a value trap unlikely to find a buyer unless things really worsen.


June 15th
Hartford Financial (HIG) July $26 / September $28 diagonal call spread trades 5,000X at $0.20

Coach (COH) November $52.50/$57.50 put back-spreads trading 7,000X3,500, shares still holding its breakout and 50 EMA with $58 key support

Yahoo (YHOO) has seen 22,500 January $16/$20 call spreads bought on the day

Weyerhauser (WY) opening sale of 12,000 July $19 puts at $0.35, seeing limited downside, and Plum Creek Timber (PCL) seller of 6,000 July $37 puts at $0.47 to open, traders look to be calling a bottom in lumber. Lumber prices are at the lowest level since October 2010 and is highly correlated with the housing market, which has been posting weak data. Weyerhauser trades 10.85X trailing earnings, 1.65X sales and 2.36X book with a 2.9% yield. Plum Creek trades 38.6X earnings, 5.5X sales and 4.7X book with a 4.3% yield.


June 14th
Visa (V) July $82.50/$85 call spread bought 10,000X

Elan (ELN) making new highs on a daily basis, and 2,600 July $10 calls trading with buyers here

Crocs (CROX) is trading 6,320 calls which is 3X daily and IV30 up 1% with strong buying in July $22 calls where more than 5,000 have been bought to open, shares breaking out of a consolidation base this morning, and strong a day after a large acquisition of Timberland in the shoe industry. Crocs has a measured move to $25 from its breakout at $20 back in April and has held strong with a weak market lately. Shares trade 16.1X earnings, 2.3X sales and 44X cash flow, also a 12.5% short float, and the $1.95B market cap could make it an eventual takeover candidate. Stifel recently reiterated a Buy and raised its target to $26, while Piper called it a top pick with seasonal strong sales for Q2.


June 13th
CH Robinson (CHRW) roll of 10,378 Aug. 75 short calls to Jan. $80 short calls, likely tied to exiting stock position

Ann Taylor (ANN) buyer of 4,000 July $24 puts at $0.50

Tyson Foods (TSN) is trading 5,660 calls early, 3X daily average, with the ITM July $16 calls seeing all the action, large buyers pushing IV higher, opening trades ahead of Smithfield (SFD) earnings later this week. There are a lot of concerns with the rising corn prices for the meta producers, but they have managed well thus far. Tyson has filled its February gap and is trying to find support. On valuation, the Company looks way too cheap, a $6.5B market cap, and trading 8.65X earnings, 0.2X sales and 1.15X book value. KeyBanc raised to Buy with a $23 target on May 20th.


June 10th
Trina Solar (TSL) trading 5,000 June $18 puts, June IV higher, mainly buyers

Masco (MAS) July $13 puts now with 6,200 trading as shares breakdown, potentially heading toward $10.50

UltraShort Euro (EUO) call volume running 2X daily with 85% offer, including 2,000 January $20 calls at $0.85 and buyers of the August $17 calls at $0.95

Fossil (FOSL) put volume running at 4,710 which is 7X daily average with a block of 3,282 December $80 puts opened at $3.10 where the bid was $2.40 and offer at $3.20, aggressive buyer. The September $80 puts also with an offer side buyer of 980 at $1.30. With much of the market correcting, shares hit new highs today but have reversed, and may start to look for a gap fill down to $95 as consumer spending slows and its global growth is called into question. Fossil is now trading 25X trailing earnings, 3.1X sales and 42.7X cash flow, at a premium to other apparel names that have already seen 15%+ corrections. Barclays raised its target to $105 on May 11th, and although Analysts are bullish, Fossil looks to have overshot. The Company has a June 22nd Jefferies Conference. ISI Group started with a Buy earlier this week and Piper reiterated Overweight on improving margins due to eCommerce. However, a block of 49,200 shares looks to be tied to the December puts.


June 9th
Xilinx (XLNX) seeing bullish action with September $34 calls with a big buyer of 2,000 at the $1.73 offer, multi-exchange sweep

Bank of America (BAC) August $11/$14 call spread bought 25,000X at $0.44, along with 25,000 August $9 puts

Textron (TXT) traded 13,592 calls on the day which is 8X daily average and mainly offer side buys as IV jumped in June, July and September from 1pm on. Larger buys included 2,000 July $23 calls, which traded 4,120X, and 2,250 July $21 ITM calls at $1.175 which traded 2,870X. The June $22 calls also traded 4,000 contracts looking for a short term bounce. Shares are very oversold and have been falling since March when shares double topped at $28.50, now 25% off highs and trying to base in an area where a range was found in October 2010. There is bullish divergence in RSI and MACD with shares making lows, so a bounce appears likely. The $5.87B conglomerate has 5 business segments and I think it could unlock a lot of value with asset sales or a separation plan. Shares trade 11.6X earnings, 0.9 PEG, and 7.4X cash flow, cheap on all metrics and with 7.6% of the float short. On May 11th Deutsche Bank reiterated a Hold and $28 target, noting its Cessna operations should see a recovery with the business jet market later this year. Goldman revised estimates lower yesterday but raised its price target up to $33 from $31, Buy rated.


June 8th
Anadarko Petro (APC) bullish spreads seeing action in January 2012 with the $60 puts being sold at $3.20 and the $80/$100 call spreads being bought at $5, net $1.80 debit and the 3 way spread done for 3,000 contracts.

Visa (V) still climbing back and a buyer comes in for 5,000 July $80/$85 call spreads at $1.20

Altera (ALTR) now trading 15,000 puts on the day, more than 9,000 June $48s while fresh action in the July $46s with more than 4,000 trading, offer side buys at $2.40, a day after the calls were active.

Cabot Oil & Gas (COG) has been an outstanding performer, touching near 2.5 year highs today as energy stocks rally. A trader just put on a large bullish bet for the future, selling 10,000 January 2012 $45 puts at $2 to buy 5,000 January 2012 $70 calls at $3.65, net credit of $0.35 on the ratio risk reversal, so protected as long as shares remain above $45, but counting on further upside to really make a profit. The $5.85B Natural Gas Co. trades 28.4X earnings, 3.1X book value and 7X sales. Canaccord raised shares to Buy today and boosted its target to $85 from $58, a major bullish call. The Analyst noted Cabots Marcellus Shale 200,000 acres if the most capital productive gas asset in North America. I would also note that its market cap makes it a very attractive buyout target.


June 7th
YUM Brands (YUM) opening buyer of 1,600 January 2012 $60 calls at $1.59 offer on the PHLX

AMD trades 7,500 October $10/$7 bull risk reversals for a $0.26 credit, but appears tied to 500,000 shares sold at $7.75

Baidu (BIDU) shares are breaking down and a trader puts on the July $125/$110 ratio put spread for 1,500X3,000 at $2.62, profit zone down to $97.62, potentially tied to 10,500 shares of stock as a hedging strategy

Take Two (TTWO) call volume is running 2X daily with the Company at E-3 launching new games. The January 2012 $15 calls are seeing the action with 3,770 trading against OI of 366, buyers paying $2.70 to open positions, $312,000 in call premium purchased in the first hour of trading today. Shares have been in the $15 to $17 range for months and earnings have been coming in strong. The $1.38B software Co. remains a likely buyout target and trades 6.6X forward earnings, 1.2X sales and 11X cash flow, a great value with a 12.5% short float. Brean Murray started shares a Hold on June 3, while BofA recently reiterated a Buy and raised its target to $23, substantial upside from here.


June 6th
Macys (M) filling its earnings gap and bullish trading in options today with more than 2,300 July $26 calls bought on the offer

Monsanto (MON) bullish spreads with 2,000 October $72.50/$80 call spreads bought to open at $1.99

Dow Chemical (DOW) call volume jumps to 22,000 which is more than 2X daily with shares at a major support level with the January, February, and March lows and also the 200 day EMA here as selling subsides. Shares are making a bullish MACD crossover and RSI is trending higher, so a bounce looks likely. The September $38/$42 ratio call spread has traded 7,000X14,000 at $0.52 to open, looking for a move back to $42 highs for max profits. The $41.4B Co. is in the hottest industry, chemicals, and trades 9.7X earnings, 0.75X sales and 1.8X book with a 2.85% dividend yield, attractive on valuation. Argus raised shares to Buy on May 5th with a $49 target, while UBS recommended buying call spreads in DOW on June 3rd.


June 3rd
Chubb (CB) trading 10X daily call volume, buyer of 4,500 October $70 calls at $0.66 offer on PHLX to open just now

Apartment Invest (AIV) trading 5,000 calls compared to the average of 15, as the September/December $30 call spread trades 2,500 contracts.

Clorox (CLX) rebounding and an opening buyer of 2,000 Oct. 70 calls at $1.70 trades on the PHLX

Covidien (COV) shares are turning higher after reaching 1 month lows and re-testing the April earnings breakout level. More than 2,300 June $55 calls bought to open at $0.50 to $0.60 and IV really jumping. Shares are very oversold here on %R and RSI. Covidien is a Company that has done everything right with strong earnings, buybacks, etc. Shares of the $27.2B medical device Co. are a safe-haven and trade just 13X earnings, 2.5X sales and 18.5X cash flow. The Company will present at the Goldman Conf. on June 8th and call volume is now running 4X daily with 4,000 of the June $55 calls trading. Deutsche Bank and Goldman both have reiterated Buy ratings in the past month.


June 2nd
Boeing (BA) with $955,000 in put premium paid today, more than 2,500 August $75 puts bought at $3.15 offer, bearish action in the name today.

Pengrowth Energy Trust (PGH) trading 5X daily call volume with 2,000 January $13 calls bought to open today at $0.85

Marathon Oil (MRO) sale of 2,500 January $45 puts to buy the $55/$65 call spread, a $0.07 net debit

Home Depot (HD) shares have fallen down to the 200 day EMA and bounced around $34.50, also a level shares broke out last December. More than 18,000 calls trading today which is 2X daily average, concentrated in August with 6,000+ of the $36 and $38 calls trading, mostly roll backs to the $36 strike for a higher Delta bullish position. The $56.57B Home Improvement Retailer is positioned for a Summer where homeowners may look to make improvements with home values at lows. Shares trade 13.2X earnings, 0.83X sales and 29.1X cash flow with a 2.8% dividend yield, a fairly good value. JP Morgan noted Memorial Weekend is one of the strongest for Home Depot and channel checks in the East were Good, but weak in the Midwest. Deutsche Bank recently reiterated a Hold with a raised target to $39 and noting it is a better play than Lowes (LOW)


June 1st
Euro (FXE) with a large buyer of 7,000 July $136 puts to open

Kohls (KSS) puts active into same store sales with around 4,500 June $55 puts rolled to July $52.50 puts.

Pulte (PHM) January $10 calls with active offer side buying again as 4,000+ trade

Interpublic Group (IPG) opening trade with 2,000 January $13 calls sold to open, tied to 114,000 shares in a buy-write

PetroHawk (HK) roll of 17,000 January $22.50 calls to January 2013 $30 calls

AutoDesk (ADSK) July $42/$38 put stupid bought at $1

Newmont Mining (NEM) is seeing massive action with 19,600 June $57.50 calls trading against OI of 10,623, June IV up, and call volume running above daily average with $461,000 in call premium paid already in 1 hour of trading. Shares have climbed back recently and Gold is holding firm above $1530. The $27B gold miner trades 12.3X earnings, 2.85X sales and 16.65X cash flow. RBC reiterated Underperform back in late April, but raised its target to $67. Shares bounced at the 10/20 EMA bullish cross this morning and are starting to move intraday.