H&R Block bull seeks quick returns

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H&R Block has long been a whipping boy for traders because of its steady loss of customers, but yesterday it showed signs of bottoming.

HRB The most interesting trade was in the November 13 calls, which saw a single block of 10,000 bought as the stock dropped but failed to reach a new intraday low. HRB shares snapped back hard and pushed higher, finishing the day up 0.94 percent at $11.76.

optionMONSTER's systems show that the calls went for just $0.15, so this trade was definitely a cheap shot looking for a push back to the upside over the short term. There is also heavy put selling in the name, with overall option volume was slightly above the daily average for HRB.
 
Short interest in the tax-preparation company was about 11 percent of the float as of Oct. 15, and it's now trading for about 7 times forward earnings--numbers that could trigger a squeeze higher.

(A version of this post appeared on InsideOptions yesterday. Chart courtesy of tradeMONSTER.)



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.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


This article appears in: Investing , Options

Referenced Stocks: HRB

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As of 10/24/2014, 04:15 PM

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