Options Intelligence Report: Zimmer Holdings, Inc. (ZMH) & Green Mountain Coffee Roasters, Inc. (GMCR)
ZMH ñ Zimmer Holdings, Inc.
Shares of the manufacturer of orthopedic reconstructive implants, dental and spinal implants, trauma products and related surgical products popped up on our ëhot by options volumeí market scanner today due to contrarian trading activity in January 2011 contract call options. Zimmerís shares earlier fell 1.5% to an intraday low of $48.27 before improving late in the session to stand 0.6% lower on the day at $48.70 as of 3:30 pm ET. ZMH was rated new ëmarket performí at Oppenheimer & Co. today.
Despite the decline in the price of the underlying shares, one options trader took a bullish stance on the stock by purchasing approximately 8,300 calls at the January 2011 $55 strike for an average premium of $1.15 apiece. The investor is poised to profit should Zimmer Holdingsí shares jump 15.3% over the current price of $48.70 to rally above the average breakeven price of $56.15 ahead of expiration day. ZMHís shares last traded above $56.15 back on July 16, 2010.
GMCR ñ Green Mountain Coffee Roasters, Inc.
News the specialty coffee company plans to increase the price of its single-serving coffee packs, known as K-Cups, by 10% to 15% starting October 11, 2010, fueled an 8.75% rally in the firmís shares price to an intraday high of $33.94. Green Mountain cited mounting green coffee prices and other short-term cost increases as impetus for its decision to charge more for K-Cups.
Investors expecting the coffee makerís shares to continue higher ahead of September expiration looked to the September $33.33 strike where at least 2,000 now in-the-money calls were picked up at an average premium of $0.74 apiece. Call buyers make money if GMCRís shares trade above the average breakeven price of $34.07 by September expiration day.
Bullish sentiment spread to the higher September $35 strike where traders purchased approximately 1,400 call options for an average premium of $0.29 a-pop. Investors long the calls stand ready to profit if Green Mountainís shares surge 4.00% over todayís high of $33.94 to exceed the average breakeven point at $35.29 by expiration this month.
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