Fortinet plummeted after cutting guidance earlier this month, but one trader is bottom-fishing in hopes of a sharp reversal.
More than 3,000 November 24 calls were bought for an average price of just $0.15, optionMONSTER's Heat Seeker system shows. The volume was triple the open interest of 1,071 contracts in the strike at the start of the session, indicating new activity.
FTNT rose 0.62 percent yesterday to close at $19.37 after drifting lower for the last several days. The network-security company gapped down to the $20 level from above $25 after lowering its outlook when reporting earnings results on Oct. 16, falling below several key moving averages along the way.
Yesterday's call buyers are looking for the stock to jump about 25 percent in less than a month. The traders could sell these options at a profit earlier if FTNT rallies before then, but the calls will expire worthless if the stock doesn't rise. (See our Education section)
Total option volume in the name was double its daily average. Only 197 puts traded in the entire session, a reflection of the bullish sentiment.
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