Tyco bull wagers on further upside
David Russell | email@example.com
optionMONSTER's Heat Seeker monitoring program detected the purchase of 7,695 July 35 calls for $0.53 and the sale of an equal number of July 32 calls for $1.30. Volume was below open interest at the lower strike, indicating that an existing position was closed and rolled higher.
The trader collected a credit of $0.77, recovering more than half their capital at risk. He or she is still eligible to profit from additional upside if the industrial conglomerate continues to rally into the summer.
TYC is up 0.92 percent to $30.82 in morning trading. The stock is up more than 10 percent in the last month and has been climbing steadily along with other industrials. It's now back to levels from early last decade, when it collapsed amid the ouster of former CEO Dennis Kozlowski.
The company's next earnings report is scheduled for Jan. 29.
Total option volume is 8 times greater than average in TYC so far today, with calls outnumbering puts by more than 17 to 1.