Bullish Option Activity Alert: CREE
Bullish Option Activity Alert: CREE
Cree, Inc. (CREE), the Durham, NC based semiconductor maker, sees it shares set a new 52 week low this morning of $30.34 and in the option markets it looks like at least one investor believes the stock will rebound over the next 2 months. The September 32.5-37.5 Call spread was purchased 10,250 times for a premium of $1.45. Open interest in the 37.5 strike is enough to cover this morningís volume so this could be a roll of a previous Bullish option trade. This spread carries a net long delta of 22, or a share equivalence of 225k shares of stock, and will need the shares to rise 9.8% by September expiry before any profits will be seen.
CREE shares have dropped more than 50% over the past year and are currently trading at their lowest level in nearly 2 years. The company is scheduled to report their Q4 earnings on August 9th with analysts calling for EPS of $.27.
About Patrick (Rick) Mortimer
Patrick(Rick)Mortimer is the Director of Options Trading at Pipeline Trading Systems LLC. With over 25 years of options trading experience as a Broker/Market Maker on the Philadelphia Stock Exchange he now provides daily insight into today’s complicated world of equity options trading. His daily alerts and commentary are valued by institutional asset managers and hedge funds and he is often quoted by well known financial news providers such as Bloomberg, CNBC, and Reuters. Pipeline’s equity and options clients have found his analysis useful in providing option strategy’s to increase alpha for current equity holdings as well as forecasting directional stock movement based on the underlying option activity.
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