Trade keeps pressure on CareFusion

By David Russell,

Shutterstock photo

CareFusion staged an abortive rally earlier in the month, and one investor remains a seller.

optionMONSTER's tracking systems detected the sale of 3,050 June 24 calls for $1.05 this morning. Volume is more than 20 times open interest in the strike.

CFN is up 0.85 percent to $24.87 today but has been stuck around this level since the market crashed last summer. The medical-technology company beat earnings and revenue estimates in its quarterly release on May 3, but management trimmed full-year guidance. That followed a weak report earlier in the year, which caused the medical-device stock to gap lower.

By writing calls, the investor apparently believes that upside is limited and is now obligated to sell the stock for $24. Including the premium, the exit price would be $25.05. He or she is probably using the calls to manage an existing position in the shares. (See our Education section)

Overall option volume is 36 times greater than average so far today.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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

This article appears in: Investing Options
Referenced Stocks: CFN

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