Qualcomm shares gained 1 percent on Wednesday, and some traders are betting the stock will see more upside in the months ahead.
The tech giant rallied after selling roughly $10 billion in bonds. Proceeds of that sale will be used to buy back Qualcomm shares over the next several months. Optimism with Qualcomm in the options market let to bullish bets on the stock outnumbering bearish ones by roughly 4 to 1.
One such bullish wager was a trade in which a buyer purchased 3,000 contracts of the October 70-strike calls for $3.20 each. As each contract controls 100 shares, the trader is betting $960,000 that Qualcomm's stock will be above $73.20 or 5 percent higher than Wednesday's close in the next five months. A call is a bullish bet giving the purchaser the right to buy a stock at a set price within a specific timeframe.
Though share prices are still up 88 percent in the last five years, the past year has seen the stock fall nearly 13 percent.
Read More This space will surge: Qualcomm prez
According to Dan Nathan, co-founder of RiskReversal.com, the trader may have bought the options to take on a bullish position in the face of some potential risks for Qualcomm.
"Their LTE chip was designed out of the latest Samsung Galaxy," said Nathan. "There have been rumors that they may be out of the next iPhone in the fall, which is one reason why you may want to look to calls to define your risk if you want to make a bullish bet."
Nathan sees the options market as particularly attractive because the implied volatility for Qualcomm—essentially, how the options are priced—were down to 18.5 on Wednesday, far from its 12-month high of 34.9 back in January.
"Making directional bets in the options market is one way to do it," he said. "Options prices are cheap."
Until this week's bond issuance, Qualcomm had no long-term debt on its balance sheet but has $15.6 billion in cash and short-term investments as of March 2015.
