Gerdau (GGB) with a large buy-write Monday, as 4,000 June $20 calls are sold for $0.85 against a large equity purchase of 125,000 shares. Shares have held rather strong during the recent steel sell-off and can be seen as a beneficiary of the 2012 Olympics in Brazil for the infrastructure needed to be built. Gerdau has been a takeover chatter mention in the past and at 9.5X forward earnings and 11.3X cash flow it is one of the cheaper plays in the industry, while having the best growth rates. Shares are pulling back to a breakout level around $15, and look ready to rebound from oversold conditions.

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2 users commented on " Gerdau (GGB) $14.95 -.93% "
Follow-up comment rss or Leave a TrackbackThe collar showed up on ivolatality with a pretty good risk/reward as well sir. semi-interested.
Thanks for the post.
It is an interesting play. Collect 85 cents against shares at $15.37, with upside to $20 through June of next year. Not bad Joe Kunkle (http://optionshawk.com/)