Markets

Late-day bulls target Hertz

Late-day activity has been common recently, and yesterday that was the case in Hertz Global Holdings.

For most of the session, options activity was light in the car-rental stock. But in the final hour, our Heat Seeker tracking system detected the purchase of about 7,800 December 13 calls, with premiums getting bid up from $0.85 to $0.95. Volume was more than twice open interest in the strike.

The trades occurred in big, institutional-sized blocks, which suggests a large investor expects the stock to rally back from the selloff that occurred earlier this month after Standard & Poor's downgraded the U.S. sovereign credit rating from AAA.

HTZ ended the session up 1.20 percent to $10.97, and has reported consistently strong fundamentals. Its last earnings report on Aug. 2 beat expectations on the top and bottom lines amid persistent demand. Management also raised guidance.

Tuesday's activity appears to reflect a belief that the stock was unfairly sold earlier in the month, and is now attractive.

Overall options volume was slightly above average. Of the 8,243 contracts that traded, only 150 were puts, which shows the highly bullish nature of the activity.

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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