Skullcandy has struggled recently but saw bullish option activity yesterday.
OptionMonster's trade scanners show that chunks of December 5 calls were purchased for $0.55. More than 1,400 traded in volume well above the strike's previous open interest of just 47 contracts, indicating that this is fresh buying.
These calls lock in the price where shares can be bought, providing investors with a less expensive way to benefit from a rally without paying for the stock directly. They can generate some nice leverage in a rally while limiting losses if the stock drops.