Safeway (SWY) sees relative strength and bullish trading for a third time this week. Shares are up 62 cents to $21.29 in active trading of 2.1 million shares. 8,000 calls and only 50 puts traded on the grocery chain so far. Apr 22 calls, which are now 3.8 percent out-of-the-money and expiring in a week, are the most actives. 5,900 traded (74 percent Ask), including a multi-exchange sweep of 2,330 contracts at the 20-cent asking price. May 22 and 24 calls are seeing interest as well. Implied volatility is up another 15 percent to 43 and in the 98th percentile of the 52-week range. SWY saw bullish trading earlier this week on the heels of Supervalu’s earnings (see 4/10 color) and again yesterday on takeover speculation (see 4/12 note). The company will report on Apr 26, and after next week’s expiration.
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.