Medical device manufacturer
Boston Scientific (BSX) is up 60% over the past year, on the back of increased interest in new technologies. One trader sees further upside going into the new year.
That’s based on the January 2025 $100 calls. With 35 days until expiration, 13,942 contracts traded compared to a prior open interest of 107, for a massive 130-fold rise in volume on the trade. The buyer of the calls paid $0.25 to make the bullish bet.
Boston Scientific shares recently traded for about $90.50, so the stock would need to rise by $9.50, or about 10.5%, for the option to move in-the-money. Boston Scientific has been in a strong uptrend all year, and are just under their 52-week high of $91.93.
Operationally, the company has had a mixed year. Revenues are up an impressive 19%, but overall earnings growth has slid 7%, indicating a potential danger from rising costs. And with shares trading at 75 times earnings, value investors may want to look elsewhere.
Action to take: As long as shares are in an uptrend, momentum investors may like shares here for further gains until the current uptrend starts to stall out.
For traders, the January 2025 $100 calls are aggressive, but are also inexpensive enough to provide investors with the potential for high-double-digit or even triple-digit returns. The option may not move in-the-money, so traders should look to take quick profits.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.
