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January 5, 2017  Thu 7:23 AM CT

A big investor is betting that Comcast will break out of its recent range.

The cable giant rallied hard with the rest of the market after the presidential election but has been trading sideways for the last month. Our tracking program detected bullish three-way option play yesterday:

10,000 August 75 calls were bought for $2.72 against open interest of 848 contracts.
10,000 August 85 calls were sold for $0.59 below open interest of 22,502 contracts.
10,000 August 60 puts were sold for $1.88 against open interest of 34 contracts.

The strategy combines a bullish vertical spread with short puts. The call spread is looking for CMCSA to rally above $75 by expiration. The sale of the higher-strike contracts reduces the cost of the long calls but limits potential gains, as the trader will be obligated to sell shares if they rise above $85. The sale of the puts further lowers the cost of the spread, but the investor will face an obligation to buy shares if they fall below $60. (See our Education section)

CMCSA rose 1.19 percent to $69.87 yesterday and is up 4 percent in the last three months. The last quarterly report on Oct. 26 was bearish. The next quarterly report is scheduled for pre-market hours on Jan. 26.

Overall option volume was 3 times greater than average.
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