PFE - Pfizer, Inc. – Shares in the
world's largest drug maker are up sharply on Tuesday, trading 3% higher
on the session at $27.65 as of 11:10 a.m. ET, the highest level in more
than five years. Pfizer's shares are rallying after the company posted
better-than-expected fourth-quarter earnings ahead of the opening bell
and forecast2013 earnings above analyst estimates. The stock has gained
more than 17.5% since mid-November. Heavy trading traffic in Pfizer call
options this morning suggests traders are positioning for shares in the
name to extend gains during the next couple of months. February expiry
calls are changing hands at a clip, with notable volume exceeding open
interest at the Feb. $28 strike price. Most of the Feb. $28 calls in
play appear to have been purchased for an average premium of $0.08 each.
Meanwhile, the single-largest print in PFE call options, a block of
24,500 contracts, traded at the Mar. $28 striking price. It looks like
one strategist purchased the call options at a premium of $0.17 each
during the first 20 minutes of the trading day. Overall call volume at
the Mar. $28 strike exceeds 28,500 contracts as of 11:30 a.m. ET,
trumping open interest of 9,870 contracts. Traders long the upside calls
stand ready to profit at March expiration should Pfizer's shares
increase another 2.0% to surpass the breakeven point at $28.17.
DFS - Discover Financial Services, Inc. – Bearish
options on credit card issuer and electronic payment services provider,
Discover Financial Services, are active this morning with shares in the
name trading 0.5% lower on the session at $37.87 as of 11:35 a.m. ET.
March expiry put options are the most actively traded contracts on
Discover today, with upwards of 9,400 lots in play at the $37 strike
versus open interest of just 33 contracts. It looks like one or more
traders purchased the bulk of the volume for an average premium of $0.91
each. Put buyers may profit at expiration in six weeks in the event
that shares in DFS slump nearly 5.0% from the current level to breach
the average breakeven point at $36.09. Discover is scheduled to report
fourth-quarter earnings after March options expiration has passed.
TSL - Trina Solar Ltd. – A burst of
upside call buying on the Chinese solar-power products manufacturer
this morning suggests one or more traders are positioning for shares in
Trina Solar Ltd. to rally during the next couple of weeks. Shares in TSL
are up more than 3% to stand at $5.07 as of 10:35 a.m. ET. The stock
briefly traded in negative territory near the open, but moved higher
during the first hour of the session on Tuesday. Bullish trading in
Trina Solar options is heaviest at the Feb. $5.0 strike, where upwards
of 10,500 calls have changed hands versus open interest of 1,376
contracts. Most of the calls were purchased during the first 15 minutes
of the trading day for an average premium of $0.31 apiece. Intraday
gains in the price of the underlying shares has lifted premium required
to purchase the $5.0 strike calls by nearly 40% to $0.43 apiece this
morning.