Israel has never been a big energy producer, but Zion Oil &
Gas could be on the verge of changing that.
The small-cap company is based in Dallas and has exploration
licenses in the northern and eastern parts of the Jewish state. It
generally doesn't track the broader market, spiking in early 2009
when the S&P 500 was crashing, and then bleeding lower in the
next two years as other stocks rallied.
On May 31, ZN gapped higher on strong volume and hasn't been down a
single day since then. The catalyst appears to have been an
announcement on May 27 that its Ma-anit Joseph #3 exploratory well
has shown evidence of hydrocarbons.
ZN climbed another 5.92 percent to $6.98 on Friday and is up 36
percent in the last month. The option activity was extremely
bullish as investors purchased about 37,000 June 5 calls for $1.90
and $1.95. Most of the trades occurred in the final 10 minutes of
trading, according to optionMONSTER's Heat Seeker screening
The activity may be linked to a rights offering last week, which
will give investors warrants in return for shares. Regardless, it
reflects a strongly positive sentiment for the company.
Calls outnumbered puts by more than 100 to 1 in the session, which
is also highly bullish.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.
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