One investor is taking profits in Vulcan Materials but remains hopeful for more upside.
optionMONSTER's Heat Seeker tracking program detected the purchase of 1,600 January 44 calls for $0.50 and the sale of an equal number of January 40 calls for $1.35. Volume was below open interest in the lower strike, which suggests that an existing position was rolled from one contract to the other.
The trader collected a credit of $0.85 and is still positioned to benefit from a rally in the stock, which surged earlier in the month on a takeover offer from Martin Marietta. VMC rejected the deal, and the shares have remained around the same level since.
The stock is up 0.75 percent to $39.17 today. Before the recent takeover interest, it had been falling for years as weaker construction sapped demand for its sand and gravel.
Today's option trade probably made money on those 40 calls following MLM's offer and now wants to lock in some of the gains. Rolling the position allowed them to get some cash back, while keeping them long in case more takeover chatter drives the stock higher.
Overall option volume is slightly above average in the name, with calls outnumbering puts by 44 to 1.
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