Options Intelligence Report: GameStop Corp. (GME), JDS Uniphase Corp. (JDSU) & Supervalu Inc. (SVU)
GME ñ GameStop Corp.
Shares of the video game retailer are up 2.4% to $25.00 this morning on an upgrade to ëbuyí from ëholdí with a 12-month target share price of $32.00 at BB&T Capital Markets where analysts mentioned GameStopís 2010 earnings could exceed current estimates. Investors reacted to the upgrade by initiating bullish transactions on the stock.
Optimistic players purchased roughly 3,800 call options at the May $27 strike for an average premium of $0.67 per contract. Plain-vanilla call buyers make money if GMEís share price surges 10.7% from the current value of the stock to surpass the average breakeven price of $27.67 by May expiration. Options implied volatility on GameStop is up 11.6% to 47.87% as of 10:50 am (ET).
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JDSU ñ JDS Uniphase Corp.
Contrarian options players employed bullish strategies on the maker of telecommunications equipment this morning despite the 2.4% decline in the price of the underlying shares to $13.41. Investors positioned for a rebound ñ and new 52-week high ñ in JDS Uniphaseís share price in the next several weeks by picking up 11,600 call contracts at the May $14 strike for an average premium of $0.65 each. Call-coveters stand ready to accrue profits should JDSU-shares rally through the effective breakeven point on the calls at $14.65 by expiration day next month.
JDS Uniphase Corp. attained its current 52-week high of $13.95 per share during Thursdayís trading session. Bullish investors long the May $14 strike calls are anticipating a fresh 52-week high, but the price per JDSU share must increase at least 5% over the current high of $13.95 in order for call-buyers to make money on the options purchased today.
SVU ñ Supervalu Inc.
The operator of a retail-grocery chain in the United States experienced a 0.40% decline in the value of its underlying share price this morning to $17.09, but the slight decline in price did not deter bullish options players from making their mark. Investors anticipating a significant rally and new 52-week high in Supervaluís shares in the next several months purchased 3,000 calls at the July $20 strike for an average premium of $0.35 per contract. Call-buyers make money as long as SVU-shares surge 19% over the current price to exceed the average breakeven point at $20.35 by expiration day.
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