Baxter has partly recovered from a brutal springtime selloff,
and one investor is looking for more gains this year.
optionMONSTER's Heat Seeker tracking system detected the purchase
of about 20,000 January 2012 55 calls for $2.89. Volume was more
than 16 times existing open interest in the strike.
BAX fell 0.14 percent to $50.55 yesterday but is up 24 percent
since bottoming out in early July. The supplier of blood and
related products has been pushing higher after a major selloff in
April, when management slashed earnings guidance.
More recent news has been more sanguine. The last earnings report
on Oct. 21 beat forecasts on both the top and bottom lines, and
management announced a $2.5 billion stock buyback last month.
The shares have been consolidating around their current level for
more than two months and seem to be finding support at their 50-day
moving average (black line on chart). They have also been pushing
against the lower end of a bearish gap from April (red line and
arrow)--a void that yesterday's call buyer apparently thinks will
now be filled.
The next scheduled events that could serve as potential catalysts
for BAX is its appearance at the JP Morgan Healthcare Conference
after the bell on Jan. 11, and its fourth-quarter earnings release
in the pre-market on Jan. 27.
Overall option volume in the stock was 7 times greater than average
yesterday, with calls outnumbering puts by 75 to 1.
(Chart courtesy of tradeMONSTER)
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