Markets

Bulls grazing on Plains Exploration

Plains Exploration & Production has gotten crushed in the last month, but the bulls are coming back.

optionMONSTER's Heat Seeker tracking program detected the purchase of more than 3,000 September 24 calls against no existing open interest. The first block priced for $5.13, followed by an immediate rally in the shares. A second block priced about two hours later for $5.53.

PXP ended the session up 6.05 percent to $20.61. It lost about one-third of its value between late July and last week, but then based around the same $26.50 level that was support and resistance almost a year ago.

The company is an independent U.S. producer of oil and natural gas. It's has been ramping up production in the last year, and its last earnings report on Aug. 4 beat estimates on the top and bottom lines.

The options activity was noteworthy because the investor used in-the-money contracts, which lets them leverage even small moves in the share price. See our Education Section for more.

Venoco, a similar company, also rallied yesterday after getting a buyout offer from its CEO. Another potential catalyst for PXP could occur on Sept. 7, when management presents at the Barclays Capital CEO Energy-Power Conference 11:05am ET

Calls accounted for a bullish 75 percent of the options volume in PXP yesterday, according to Heat Seeker.

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

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

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