Unusual Option Activity: Meta Platforms (META)

Social media operator Meta Platforms (META) has been soaring higher following its latest earnings beat and after announcing it will start paying a dividend. One trader sees shares rising further in the coming weeks.

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  • That’s based on the March 1 $465 calls. With 23 days until expiration, 4,832 contracts traded compared to a prior open interest of 185, for a 26-fold rise in volume on the trade. The buyer of the calls paid $12.95.

    Meta shares recently traded for about $460, so shares would need to rise $5, or about 1 percent, for the option to move in-the-money.

    Meta hit a 52-week high of $485.96 last week after earnings, so the strike price of the option looks reasonable.

    The company’s cost-cutting measures over the past year appear to be paying off with higher profitability. And Meta is getting further analyst upgrades, which could help shares rally in the short-term.

  • Special: $1,300 into $45,000 in just 4 MONTHS?!
  • Action to take: Investors may like shares as a momentum trade here. Meta’s new dividend is less than 0.5 percent, but it will likely increase with time.

    For traders,  the March calls are well positioned for shares moving higher in the coming weeks.

    While they carry a relatively high price, traders can likely see mid-double-digit gains in the coming days, allowing for a quick profit.


    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.

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