Last-minute bulls like Diamond Foods

optionMONSTER

Diamond Foods has been beaten down in recent years but is drawing upside option activity ahead of its earnings report after today's close.

optionMONSTER's Heat Seeker system has detected heavy buying in the June 17 calls, where more than 3,600 contracts traded for an average price of $0.65. The volume was well above the strike's open interest of 1,431, indicating new activity.

DMND is up 2.76 percent to $16.69 this morning, sending the heavily shorted stock back above its 200-day moving average. Shares plummeted from the $90 in late 2011 amid questions about Diamond's accounting practices, which led Procter & Gamble to withdraw its offer to buy the company's Pringles brand. The stock gapped down again last November after restating earnings and has been trading sideways since then.

Today's long calls , which lock in the price where traders can buy the stock, are looking for DMND to another 6 percent by the end of next week. But those contracts could expire worthless if shares remain below the $17 strike price. (See our Education section)

The packaged-food company is scheduled to release its next quarterly results at 5 p.m. ET today.

Total option volume in the name exceeds 5,300 contracts so far, 5 times its daily average in the last month. Calls outnumber puts by nearly 6 to 1, a reflection of the session's bullish sentiment.

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