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Wednesday, July 6, 2022

Buy now

LVS Put Buyers Could Rake In The Chips If Shares Extend Pullback


Today’s tickers: LVS, AMT & APC

LVS – Las Vegas Sands Corp. – The resort casino operator’s shares, which have had more down days than up during the most recent four week period, caught a break today, trading 1.6% higher on the day at $50.08 as of 11:50 a.m. in New York. It looks like some options traders, perhaps wary the stock’s pullback has not yet run its full course, are taking advantage of today’s rally to establish bearish put positions. Las Vegas Sands shares are down nearly 20.0% off the April 12th three-year high of $62.09. Traders prepared for double-digit declines in the shares from here exchanged 2,100 puts at the Sep. $45 strike this morning, buying most of the contracts for an average premium of $2.96 apiece. Put buyers stand ready to profit should shares in LVS decline another 16.0% to breach the average breakeven price of $42.04 at expiration in four months. Shares in the casino operator last traded below $42.04 in the first week of 2012, before the stock commenced a more than 30.0% run to the upside to the mid-April multi-year high.

AMT – American Tower Corp. – Shares in American Tower Corp., a REIT that owns and operates wireless communications and broadcast towers in the U.S., are up 0.50% at $67.54 this morning on positive analyst comments from Bank of America recommending the stock as a buy. May expiry call buying suggests one or more traders anticipate the price of the underlying will extend gains this week. Options volume is heaviest at the May $67.5 strike where more than 2,000 in-the-money calls changed hands against open interest of 693 contracts. It looks like most of the calls were purchased for an average premium of $0.50 apiece, with profits available to the upside in the event that AMT’s shares rally another 0.60% to top the average breakeven price of $68.00 by expiration. American Tower shares rallied to a 52-week high of $68.52 earlier this month, taking the stock’s year-to-date run to 17.5%.

APC – Anadarko Petroleum Corp. – Options plays initiated on oil and gas exploration and development company, Anadarko Petroleum Corp., today are looking for a rebound in the price of the underlying in the near term. Shares in APC, up 0.90% this afternoon at $67.35, have been hit hard in recent months, down nearly 25.0% since February. Traders preparing for shares to reverse course appear to have purchased around 5,000 calls at the June $70 strike against the sale of roughly the same number of calls up at the June $75 strike, all for an average net premium outlay of $1.14 per contract. The bull call spread may be a profitable strategy come June expiration in the event that Anadarko’s shares rally 5.6% to exceed the average breakeven price of $71.14. Maximum potential profits of $3.86 are available on the position if the price of the underlying gains 11.4% to top $75.00 by expiration.


Caitlin Duffy

Equity Options Analyst

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