Options Bullish on Offshore Energy Co. — After Weak Earnings
Helix Energy is trading lower since its earnings announcement yesterday, but option activity is bullish in the name.
The offshore energy company is down 4.35 percent in midday trading to $10.56.
The stock gapped down this morning after posting a larger-than-expected loss after the market closed yesterday. Helix still has not broken the $10 support level it touched earlier in the month, but has seen lower highs since the 52-week peak of $16.92 back in October.
One option trader apparently believes that the bleeding is over, as OptionMonster's tracking systems show a block of 2,000 of the June 10 calls picked up for $1.40. This action is well above the open interest of 240 contracts and the average total daily option volume of fewer than 400 contracts, so it represents a new position.
The implied volatility has fallen, as is usually the case after earnings, and the use of the in-the-money calls reduces time premium paid.
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Chris McKhann is an analyst and writer for OptionMonster.