Solar stocks have been coming back to life, and the bulls are
gunning for a huge move in Yingli Green Energy.
optionMONSTER's Heat Seeker monitoring system detected the purchase
of 3,000 June 10 calls for $0.71 and the sale of an equal number of
June 15 calls for $0.19 yesterday. Volume was more than 15 times
higher than the previous open interest in each strike, indicating
that new money was put to work.
The investor paid just $0.52 to open this
and has the right to collect $10 if the stock closes at $15 or
higher on expiration. That would be profit of some 1,800 percent
from the shares barely doubling. (See our
section for the potential leverage of options.)
YGE rose 1.74 percent to $7.01 yesterday. The stock climbed from
below $2 to above $8 between April and October, pulled back to its
200-day moving average in December, and has been continuing higher
since. It last saw $15 in early 2010, when solar-energy companies
were in the process of a major selloff.
Sentiment in the industry has improved in the last 18 months as
bargain hunters find value and business conditions improve, making
it one of the top groups on our
market-analysis tool in the long term.
Total option volume in YGE was about average yesterday, but calls
outnumbered puts by a bullish 10-to-1 ratio.
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