Sprint (S) continues its run higher. Shares are up 19 cents to $4.24 today and have rallied 25.8 percent since the company’s earnings report yesterday morning showed stronger-than-expected EPS numbers thanks to strong iPhone sales. Options on the stock are actively traded for a third day. While upside call buyers dominated the flow Wednesday (see 7/25 color) before the report and yesterday (see 7/26 color) after earnings, the flow today is concentrated in the Aug 4.5 straddle, trading mostly electronically on ISE and AMEX. The largest is 8,300 for 49 cents on ISE. While it traded on the low side (on the bid), ISEE is reporting an opening customer buyer. 30-day ATM vols are moving up 14 percent to 54. Meanwhile, the largest open interest position in Sprint is the Jan 3 put. The second biggest is the Aug 4 call, which is now in-the-money, and includes a position opened Wednesday when 40,000 were bought for a nickel per contract just before the closing bell (see 7/25 color). The market is now 39 to 40 cents.
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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.