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Options Intelligence Report: Research in Motion Limited (RIMM), Intuit Inc. (INTU) & Las Vegas Sands Corp. (LVS)

Bulls Bombard Research in Motion Ahead Of BlackBerry 9800 Launch

RIMM – Research in Motion Limited
Optimistic options players populated the Blackberry maker’s August contract, selling puts and buying calls to prepare for the price of the underlying stock to continue climbing ahead of expiration day next month. RIMM’s shares rallied as much as 4.53% today to an intraday high of $55.59 on reports the Canadian company will reveal its new touch screen BlackBerry in New York next Tuesday. Investors are chomping at the bit to see if the BlackBerry 9800 can give iPhone maker, Apple, a run for its money – or market share. RIMM’s shares have bounced up off their early-July lows, but the recovery could be short-lived if the 9800 turns out to be a disappointment. Traders hoping to see a successful launch of the touch screen device, and subsequent share price appreciation, employed bullish strategies. Investors picked up at least 3,800 calls at the now in-the-money August $55 strike for an average premium of $2.15 apiece. Buying interest spread to the higher August $57.5 strike where 3,900 calls were purchased at an average premium of $1.16 each. Uber-bulls bought roughly 2,900 call options at the August $60 strike for an average premium of $0.68 a-pop. Investors long the August $60 strike calls are poised to profit should RIMM’s shares surge 9.25% to surpass the average breakeven price of $60.68 by August expiration. The sale of out-of-the-money put options is another bullish signal investors are itching for the current rally to continue. Traders sold some 2,000 puts at the August $50 strike for an average premium of $0.55 each, and shed another 5,200 puts at the higher August $52.5 strike for an average premium of $1.21 apiece. In total, options players exchanged more than 91,300 contracts on Research in Motion by 3:40 pm ET. Options implied volatility on RIMM is up 3.4% to 43.85% ahead of the final bell.

                                       
 

INTU – Intuit Inc.
The provider of business and financial management solutions popped up on our ‘hot by options volume’ market scanner late in the trading session after one options strategist initiated a bearish transaction in the October contract. Intuit’s shares are down slightly by 0.15% to stand at $39.50 as of 3:15 pm ET. It looks like the trader bought a plain-vanilla debit put spread, buying 6,346 puts at the October $37.5 strike for a premium of $1.08 each, and selling the same number of puts at the lower October $34 strike for premium of $0.36 apiece. The net cost of establishing the spread amounts to $0.72 per contract. Intuit’s shares must decline 6.9% from the current price in order for the investor to breakeven on the trade at a share price of $36.78. The put spreader may walk away with maximum potential profits of $2.78 per contract if Intuit’s shares tumble more than 13.9% lower to trade below $34.00 by October expiration. The overall reading of options implied volatility on INTU is higher by 5.8% to stand at 26.03% in the final hour of the trading session.

 


LVS – Las Vegas Sands Corp.
Shares of the owner and operator of casino resorts increased as much as 6.40% this afternoon to secure an intraday high of $26.90 following the firm’s better-than-expected second-quarter earnings report released ahead of the opening bell this morning. The casino company posted profits of $0.17 a share, excluding some items, which blew straight past analysts’ consensus estimate of $0.09 a share. Options investors responded to the positive report by initiating various near-term bullish trading strategies on the stock. Optimistic individuals expecting shares to continue to rally ahead of August expiration purchased 1,800 in-the-money calls at the August $26 strike for an average premium of $1.36 apiece. In-the-money call buyers make money as long as Las Vegas Sands’ shares increase 1.70% over today’s high of $26.90 to surpass the average breakeven point at $27.36 by expiration. Investors hoping to see LVS’s shares reach a new 52-week high in the next few weeks scooped up approximately 3,700 calls at the higher August $27 strike for an average premium of $1.03 a-pop. Investors long the August $27 strike calls start to accumulate profits should shares of the underlying stock surge 4.20%, break through the current 52-week high of $27.84, and trade above the average breakeven price of $28.03 ahead of next month’s expiration day. The sale of 1,000 puts at the August $27 strike for an average premium of $1.63 each is also a bullish signal. Perhaps put sellers are ditching previously established bearish positions. Otherwise, traders may be selling the puts outright because they expect shares to trade above $27.00 by August expiration. The sale of the contracts indicates some investors are willing to have shares of the underlying stock put to them at an effective price of $25.37 each should the puts land in-the-money at expiration. The overall reading of options implied volatility on Las Vegas Sands Corp. declined 12.3% to 49.63% following earnings. 


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