Trader bets on comeback in Hologic

optionMONSTER

Hologic has been pulling back this month, but one trader is betting on a rebound.

optionMONSTER's Heat Seeker system detected the purchase of 2,000 May 20 calls yesterday, led by a print of 1,474 that went for $1.50. This is clearly a new position, as the strike's open interest was a mere 10 contracts before the session began.

The long calls , which lock in the purchase price for the stock no matter how high it might climb, are looking for HOLX to rally above $21.50 by mid-May. These options could be sold earlier at a profit if their premiums rise with a rally before then, but they can expire worthless if shares remain below the $20 strike price. (See our Education section)

HOLX rose 0.77 percent yesterday to close at $20.94 but is about 7 percent since the beginning of April. The stock dropped early in the month after its 10-day moving average fell below the 50-day line, but shares are now apparently trying to bounce at their 200-day average.

The company, which manufactures medical-diagnostic equipment, is scheduled to release its next quarterly results on May 6 after the close. The May calls expire less than two weeks later.

Yesterday's call buying made up 95 percent of the total option volume in HOLX. Only 2 puts traded in the session, a reflection of the day's bullish sentiment.

Earlier this month Hologic saw call buying and put selling on different days, trades that are both positive on the stock.


More From optionMONSTER

View Comments (0)