CNBC Stock Blog

Bulls Pile Into Waste Management

David Russell | Writer, OptionMonster
A driver backs his truck into a bay at a Waste Management trash processing facility in Cicero, Illinois.
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Waste Management reports earnings next week, and the bulls jumped on board yesterday.

OptionMONSTER's tracking systems detected the purchase of about 14,000 March 37 calls in volume that was well above the strike's previous open interest of just 3,323 contracts, indicating fresh buying. Premiums rose from $0.30 to $0.70 as the trades crossed, which shows a strong buying pattern.

Calls lock in the price where investors can buy stock in the trash hauler, and their low cost can result in significant leverage on a percentage basis should Waste Management make even a small move higher. But they'll also become worthless if it doesn't climb or declines.

Waste Management shares rose 1.25 percent to $36.55 yesterday and is up 8 percent so far this year. Fourth-quarter results will be issued on Feb. 14.

Total option volume was five times greater than average in the session, with calls outnumbering puts by 12 to 1.

—By CNBC Contributor David Russell

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David Russell is a reporter and writer for OptionMonster. Russell has no positions in WM.