Shares in packaged foods producer Kellogg Co. (Ticker: K) are in positive territory on Monday afternoon, trading up by roughly 0.20% at $65.48 as of 2:20 p.m. ET. Options volume on the stock is well above average levels today, with around 12,500 contracts traded on the name versus an average daily reading of around 1,700 contracts. Most of the volume is concentrated in September expiry calls, perhaps ahead of the company’s second-quarter earnings report set for release ahead of the opening bell on Thursday. Time and sales data suggests traders are snapping up calls at the Sep 67.5, 70.0 and 72.5 strikes. Volume is heaviest in the Sep 72.5 strike calls, with around 4,600 contracts traded against sizable open interest of approximately 11,800 contracts. It looks like traders paid an average premium of $0.37 per contract for the 72.5 strike calls, which may be a profitable trade at expiration in September in the event that Kellogg shares rally 11% over the current price to exceed the average breakeven point at $72.87. Shares in Kellogg traded up to a 52-week high of $69.50 in June, but have not traded above $72.87 since August of 1997. The concentration of trading traffic in September expiry calls on Kellogg today has pushed the call/put ratio on the name to roughly 6.5 this afternoon.
Chart – 20-year chart of Kellogg
This article will become free after 48 hours (see below for free content). To read the rest of this article now, along with Phil's live intra-day comments, live trading ideas, Phil's market calls, additional member comments, and other members-only features - Subscribe to Phil's Stock World by clicking here.
Tags: K
This entry was posted on Monday, July 28th, 2014 at 5:03 pm and is filed under Uncategorized. You can leave a response, or trackback from your own site.
Do you know someone who would benefit from this information? We can send your friend a strictly confidential, one-time email telling them about this information. Your privacy and your friend's privacy is your business... no spam! Click here and tell a friend!
