Option Bulls Want to Ring Up Gains With NXP Semi
is back on the bulls’ radar.
OptionMonster’s tracking systems detected the purchase of more than 1,700 August 22.50 calls, most of which priced for $1.40. Volume was more than triple the previous open interest, indicating that these are new positions.
Those callslock in the price investors must pay to buy shares in the company, whose chips are used in wide array of applications, including automotive, wireless, and lighting products. Calls can generate significant leverage in the event of a rally, but will expire worthless if the stock doesn’t move.
Shares of NXP Semiconductors fell 0.94 percent to $22.13 yesterday. The stock rallied from about $15 to $27 between January and late March, then pulled back below $20 and has been working its way higher since. Investors have recently been focusing on the company’s technology being used in near-field communications, which will let people charge their credit cards by tapping their cell phones.
The last earnings report in April was strong as management issued bullish guidance. Shares also gapped higher with no clear headline on June 29 and have been holding their ground since. The next set of quarterly results comes out before the bell on July 24.
Overall option volume was seven times greater than average in the session, with calls outnumbering putsby 16 to 1.
—By CNBC Contributor David Russell
Additional News: Intel Buys Into Next-Gen Chipmaker ASML for $4.1 Billion
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David Russellis a reporter and writer for OptionMonster . Russell has no positions in NXP Semiconductors.