Bulls Want to Call Beazer Home
Beazer Homes USA has been consolidating for the last two weeks after starting the year strong, and now traders are ready for the rally to resume.
OptionMonster's tracking systems detected the purchase of about 7,800 February 2.50 calls for $0.80 to $0.85. Volume was almost 12 times open interest in the strike.
Those contracts lock in the price the trader must pay for shares in the Atlanta-based homebuilder. They are in the money, meaning that the strike price is below the stock's current level. That essentially lets the trader control shares without having to pay the full price.
Beazer Homes shares rose 5.50 percent to $3.26 yesterday. It has more than doubled since early October as market sentiment improves toward residential real estate. The stock ripped above its 200-day moving average earlier in the month, then pulled back, and is now attempting to continue higher.
Overall option volume was 7 times greater than average in the name, with calls outnumbering puts by 22 to 1.
The company's next earnings release is scheduled for the morning of Feb. 2.
—Russell has no positions in BZH.
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David Russell is a reporter and writer for OptionMonster.