CNBC Stock Blog

Pepsi Options Boil After Earnings Forecast

David Russell|writer, OptionMonster

Bullish traders are lapping up options in PepsiCo after Deutsche Bank raised its earnings forecast for the beverage company.

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Call volume surged almost 700 percent in the beverage and snack company, while PEP shares surged to levels last recorded during market crash in October. The busiest strike was the November 62.50 calls, which traded 5,724 times against open interest of 1,260 contracts. Most of the volume priced for $0.90 to $1, according to OptionMonster's proprietary tracking systems.

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PEP rose 4.31 percent to $60.98 in early afternoon trading. Deutsche Bank said investors are too worried about depreciation costs going forward and that PEP will benefit from lower input costs and favorable currency trends.

The company is scheduled to report third-quarter results before the bell on Oct. 8.

Heat Seeker also detected unusual activity in the October 60 calls and the October 62.50 calls, although volume was below open interest in both strikes.

Overall options activity was more than three times greater than average. Calls outnumbered puts by 3 to 1.

PepsiCo Competes With:


Dr Pepper Snapple Group

Kraft Foods



David Russell is a reporter and writer for OptionMonster.