AnnTaylor Stores ripped higher on a bullish forecast yesterday,
and one investor is shopping for more gains.
optionMONSTER's Heat Seeker tracking system detected a surge in
call activity in the fashion retailer as existing positions were
liquidated and rolled forward by a month. The selling involved
3,000 May 25 calls for $0.85 and 2,000 May 22.50 calls for $2,
while the buying targeted 4,000 June 25 calls for $1.43.
The transaction occurred in a single second and accounted for 60
percent of the options volume in ANN. It yielded a net credit for
$83,000 and gave the investor another month of exposure to the
ANN rose 9.32 percent to $24.76 yesterday and is up 82 percent so
far this year. The company said in a preliminary report that fiscal
first-quarter profit and sales will significantly exceed its
earlier forecasts. Full results will be issued on May 21.
The shares gapped higher on the news, hitting a new 19-month high
of $25.15 and bucking losses in the broader market and the
consumer-discretionary sector. Yesterday's close was the highest
for ANN since the financial markets started melting down in
Short interest represented a hefty 16 percent of the float as of
April 15, which could also help push the shares higher.
Overall options volume in ANN was seven times greater than average
yesterday, with calls accounting for a bullish 74 percent of the
(Chart courtesy of tradeMONSTER)
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