Why The Big Calls Bought on Newfield Exploration Co. (NFX)

The big options trade so far this morning appears to be in Newfield Exploration Co. (NYSE: NFX).  NFX is seeing a lot of action by some large single entity with an opening buyer of 5000+ Jan $55 calls for 50 cents, 5000 Jan $45 calls at $3.00, AND,  2400 Jan $42 calls at $4.20!

These were all opening buys, so I think it’s safe to say that someone close to the company is trading on some not so widely known info.  Surprise!  Another example of rampant insider trading with zero SEC enforcement?  Possibly.

Or, it could just be the fact that Jefferies Group raised NFX price target to $61.00 from $41.00 just yesterday.  While this is an obvious factor in the buy, why did they wait until today to make the trade?  We expect some news will come out in the next week or two that will spike the price up, long before January expiration.

Here’s the 5 day chart on Newfield Exploration Co. (NYSE: NFX)