Unusual Options Activity: Eos Energy Enterprises (EOSE)

Energy storage solution company Eos Energy Enterprises (EOSE) have been trending higher in recent sessions. One trader sees that trend continuing in the coming few weeks.

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  • That’s based on the August $4.50 calls. With 51 days until expiration, 12,101 contracts traded compared to a prior open interest of 112, for a 108-fold rise in volume on the trade. The buyer of the calls paid $0.80 to make the bullish bet.

    Shares recently jumped to the $4 range, so they would need to rise another $0.50, or about 12.5 percent, for the option to move in-the-money. Eos is also near a 52-week high of $4.22, so the stock would need to break to new highs.

    The company is up 140 percent over the past year, with revenues up 168 percent. While Eos isn’t making a profit yet, it’s seeing strong demand for its zinc-based electric storage system, which is competing with lithium-ion technology, particularly for the

    Action to take: The big jump higher in Eos is a technical breakout, suggesting further upside ahead in the short-term.

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  • However, once that buying frenzy ends, shares may give up much of their recent gains. Investors could buy shares now and look to take a quick profit, while longer-term investors may want to exercise patience here.

    For traders, the August $4.50 calls are well positioned for further short-term upside in shares. Just look for the uptrend to break and take profits quickly.

     

    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 of the companies mentioned in this article.

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