Market News

January 3, 2017  Tue 7:50 AM CT

Traders are betting that Cal-Maine Foods will continue its recent uptrend.

Our scanners show that about 2,200 May 45 calls were purchased for $2.30 to $3 on Friday. This represents fresh buying, as open interest in the strike was just 39 contracts before the session began.

Long calls lock in the price where investors can buy stock, allowing them to profit from a rally with limited capital at risk. Their cheap cost can also generate significant leverage on a percentage basis if shares move in the right direction. (See our Education section)

CALM rose 1.09 percent to $44.18 on Friday and is up 10 percent in the last three months. The egg producer's next quarterly report is estimated for release after the close on March 27.

Overall option volume was 3 times greater than average in the name on Friday. Calls outnumbered puts by a bullish 6-to-1 ratio.

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