Capital One Financial Corp. (NYSE:COF) – Trading traffic in weekly call options on Capital One Financial Corp. (NYSE:COF) suggests one or more traders are gearing up for shares in the name to extend gains in the near term. Shares in Capital One Financial Corp. (NYSE:COF) are up more than 6.0% in early afternoon trading to stand at $56.10 after the company reported first-quarter earnings that exceeded analyst expectations following the close of trading on Thursday. Upside call buying in the weeklys looks for shares to continue higher, with the April 26 ’13 $55 strike calls changing hands 1,300 times versus open interest of 48 contracts. It looks like most of the $55 calls were purchased for an average premium of $0.84 each in the early going this morning. Traders long the calls at $0.84 are already seeing the value of the contracts move in their favor, with the last traded price on the contracts up at $1.40 as of 12:25 p.m. ET. Profits are available at expiration if shares in Capital One Financial Corp. (NYSE:COF) settle above the average breakeven price of $55.84. Meanwhile, traders with perhaps a less rosy outlook on Capital One Financial Corp. (NYSE:COF) shares during the next five trading sessions appear to have purchased around 420 of the April 26 ’13 $52.5 strike put options at a premium of $0.15 each. These contracts make money at expiration if the price of the underlying pares post-earning gains to trade below an effective breakeven price of $52.35.
OSI Systems, Inc. (NASDAQ:OSIS) – Put activity on the maker of medical monitoring and anesthesia systems look for shares in OSI Systems, Inc. (NASDAQ:OSIS) to tumble following the company’s third-quarter earnings report ahead of the open next Wednesday. Shares in OSI Systems, Inc. (NASDAQ:OSIS) are roughly flat at present, down just 0.05% to stand at $54.97 as of 12:30 p.m. ET. The stock has dropped more than 15% since the beginning of the year. Options traders positioning for the price of the underlying to extend losses in the near term appear to have purchased around 2,000 puts at the May $50 strike at a premium of $1.00 per contract. Profits are available on the bearish position should shares in OSI Systems, Inc. (NASDAQ:OSIS) decline more than 10% from the current level to trade below the breakeven price of $49.00 at May expiration. Shares last traded below $49.00 in November.
Caitlin Duffy
Equity Options Analyst
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