Bet on shares moving 20 percent higher by late January.
The January 17th 2020 $280 call options on Amgen (AMGN) saw a 21-fold increase in volume with over 3,100 contracts trading hands. Shares of the company would need to rally about 19 percent from their current price near $234 for this out-of-the-money call to expire with any value.
The option buyer paid around $0.10, or just $10 per contract, so it’s a cheap bet on shares moving higher in the next few weeks.
- This Leaked Wall Street Calendar Is Tipping of Repeat Gains
Multi-millionaire Florida hedge fund manager has just released a secret Wall Street calendar that he’s been using to land massive gains on the same stocks on the same dates for an entire decade.
And just by looking at his recent trades…. There’s no signs of this “repeat phenomenon” slowing down…
168.09% on SHW… 60.0% on ATVI… 168.97% on SMG… and TEN others just in the last few months… all going up on the same dates, every year, for an entire decade.
Even if shares don’t hit the $280 strike price, a sharp rally could lead to a quick double or triple from current prices.
The diversified pharmaceutical manufacturer has seen shares beat the S&P 500 in the past year by three points, amidst a tough year for the space in general.
Shares are well-valued at just under 15 times forward earnings, and the company has a huge 34.5 percent profit margin. Today’s shareholder can also get a 2.5 percent dividend yield.
Action to take: Long-term, we like shares here up to $240.00. However, the pharma space isn’t one that often provides huge swings upward, even if the entire sector is oversold right now, so we’re a bit skeptical that the soon-to-expire January option will make traders a profit.
A better trade may be the July 2020 $250 calls. They’re a lot more expensive near $9, or $900 per contract, but they have a better chance of moving in-the-money rather than betting on a $0.10 option to double or triple in just the next few weeks.