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• Pfizer trade buys more time for rally
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• BBBY 100% Rate It

A large trader is looking for a pop or a drop when Bed Bath & Beyond reports earnings this afternoon.

optionMONSTER's monitoring programs detected the purchase of about 3,200 July 85 calls for $2.95 and a similar number of July 75 puts for $2.67. Volume exceeded open interest at both strikes, indicating new positions were initiated.

The overall strategy cost a net $5.62 and will make money if the home retailer closes below $69.38 or above $80.62 on expiration. Known as a straddle , it's a common method to profit from a spike in volatility . (See our Education section)
 
BBBY rose 0.62 percent to $74.72 yesterday, its higher closing price ever. Shares have been climbing for the last three years, driven by customer gains and wider profit margins. The last earnings report on April 4 showed that business was continuing to improve as consumers spent more to fix up their homes.

A strong earnings report could drive the stock to new highs, while poor results could trigger a selloff. If the shares don't see a sharp move, however, the straddle buyer will lose money as the calls and puts lose value after the big news event.

Overall option volume was 10 times greater than average in the session.

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