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How bulls are playing Hanesbrands

The bulls are targeting Hanesbrands with earnings due next week.

optionMONSTER's Heat Seeker monitoring program detected the purchase of 3,000 February 110 calls for $2.40 and the sale of 3,000 February 115 calls for $0.90. Volume was more than 5 times open interest at both strikes, which indicates new positions were initiated.

Known as a vertical spread , the trade will earn 233 percent if shares close at $115 or higher on expiration. Only their $1.50 debit is at risk if the stock drops, which ensures that the traders won't lose their shirts because of a bad set of numbers on Jan. 29. (See our Education section)

HBI fell 0.06 percent to $107.10 yesterday. The apparel company more than tripled in 2013 and 2014 but has ground sideways for the last four months. Yesterday's call spread appears to target the top of that range.

Overall option volume was 69 times greater than average in the session, with calls accounting for a bullish 95 percent of the total.

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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