Denbury Resources has been rolling higher, and yesterday the bulls were looking for more upside ahead of this morning's earnings report.
The Nov. 17 calls jumped quickly yesterday morning, with multiple large blocks hitting for 45 cents to 55 cents. The stock kept climbing and those same calls traded for 85 cents by the end of the day, according to OptionMonster's real-time tracking systems. More than 14,000 of the options changed hands against previous positioning of 5,992.
Long calls lock in an investor's entry price, so they are worth more when shares rise. They provide major leverage and can double or triple from a relatively small move in the stock price, but can also expire worthless if shares stall or go the wrong way.
DNR moved the right way yesterday, closing higher by 5.12 percent at $16.01. The company is a rapidly growing producer of oil and natural gas with significant acreage in the Rocky Mountains and the Gulf Coast. It got an added boost from the likes of EOG Resources reporting a strong third quarter.
Denbury's stock is off its lows for the year, but still down double-digits on a percentage basis from the start of 2011. Earnings results are scheduled to come out before the market opens today.
More than 14,000 Nov. 17 calls traded in Denbury yesterday. Total option volume in DNR was 12 times its daily average. Just 244 puts traded in the entire session.
—Najarian has no positions in DNR.
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Pete Najarian is a professional investor, CNBC contributor, regular co-host of CNBC's "Fast Money" and co-founder of .