Safeway (SWY) is up 52 cents to $20.71 on increasing volume of 7.9 million shares and implied volatility in the options on the stock is moving sharply higher after 16,000 calls and 7,350 puts traded on the grocery store chain. The activity has been in smaller lots and includes a multi-exchange sweep of 1,837 Apr 20 puts at the 20-cent asking price. 4,750 now traded. The next most actives are Apr 20, Apr 21, Jun 24, Jun 22, May 22 and May 21 call options. The overall flow reflects bullish sentiment for a second time this week. Safeway saw increasing volume Tuesday after Supervalu reported better-than-expected earnings (see SWY 4/10 color). Today’s heightened activity is possibly related to takeover speculation (Briefing). Meanwhile, implied volatility in the options on the stock is a big mover of the day — up 23 percent to 39 and in the 92nd percentile of the 52-week range. The company is expected to report earnings around Apr 26 (unconfirmed).
About the Author (Author Profile)
Frederic Ruffy is a well-known trader, writer, and strategist who has spent years educating investors and creating intelligent, insightful, unbiased market observations that are frequently cited by the Wall Street Journal and other financial publications. As senior analyst, Fred provides frequent and regular notes and daily updates for activity of interest.