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With crude collapse, traders sense opportunity in this name

On a day when the Dow cracked 18,000 and the S&P 500 closed at an all-time high for the 51st time this year, some traders bet big on one under-the-radar financial name that has been hit by the collapse in energy prices: KKR.

In nearly four times its average daily volume, a trader Tuesday bought 2,000 of the January 2016 27-strike calls for $0.35. This trade, which costs about $70,000 to make, is a bet that KKR will rise above $27.35 by January of 2016, or roughly 20 percent in a year from now.

Read MoreOil falls, near $60 on supply glut, strong dollar

KKR is heavily invested in the energy space, perhaps most notably with the 2011 acquisition of Samson for $7.2 billion, the largest-ever buyout of an oil and gas company. But as energy prices have plummeted on the year, crude oil is down nearly 50 percent in just six months and natural gas is sitting at multi-year lows, KKR's stock has struggled to stay afloat.

"[KKR] has been getting a lot of negative press lately because of exposure to energy, specifically their Samson energy investment," said CNBC Contributor Mike Khouw on Tuesday's episode of Fast Money. "But I think people should be taking a look at the fact that this stock is incredibly cheap, trading at about 9 times next 12 month earnings."

Sterne Agee's Jason Weyeneth also sees money to be made in KKR, having added it to his top trade ideas for 2015. "[The] underperformance in 2014, in our view, creates an attractive opportunity," the firm's senior research analyst wrote in a note. "We see nearly 55 percent total return upside in KKR." Weyeneth has a buy rating on the stock with a $32 price target.

Read More Nat gas collapses — 'This is panic selling'

With energy prices so low, some see KKR as a levered way to play a potential rebound in crude and commodity prices.

"As energy prices collapse, that only spells better investment opportunities for opportunistic investors like KKR," added Khouw. "I think this is a good play."

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    Melissa Lee is the host of CNBC's “Fast Money” and “Options Action.”

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