Bulls are back on the road with Delphi

After years of painful restructuring, Delphi Automotive seems finally back on the right track.

The auto-parts giant is up about 50 percent since returning to the market in November, and the bulls are looking for more. On Friday our Heat Seeker system detected the purchase of 14,000 May 30 calls for $2.15 and the sale of an equal number of May 35 calls for $0.25. There was barely any open interest in either strike before the trade appeared, so this activity was opening new positions

Known as a bullish call spread , the strategy cost $1.90 and will earn a maximum profit of 163 percent if the stock closes at or above $35 on expiration. (See our Education section)

DLPH ended Friday's session with a 6.14 percent gain to close at $30.75. The company was originally spun off from General Motors in the late 1990s and has struggled early in the last decade. It filed for bankruptcy protection in 2005 and was involved in a lengthy process of closing plants and rebuilding itself since then.

Conditions in the auto-part industry have improved significantly in the meantime as demand grows and new technologies lift margins. DLPH's earnings report on Jan. 26 reflected that strength, beating forecasts on the top and bottom lines, while profit guidance was strong for the full year.

Overall option volume on Friday was 51 times greater than average. Calls outnumbered puts by a similar amount, according to the Heat Seeker.

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