Big Option Trade In El Paso Pipeline Partners (EPB)

Someone made a big bet in El Paso Pipeline Partners (EPB) today, buying 6,495 Dec $45 calls in EPB around 2pm today.  This is some impressive and unusual volume in EPB options. The open interest in the Dec 45’s prior to this was just 1242.

The natural gas transportation company is trading at $36.48, up 64 cents so far.  El Paso Pipeline Partners (EPB) stock price has been on a considerable uptrend since it’s June 13 bottom around $33.70.

It’s a big be on a stock that only trades under 700000 shares a day on average.  The estimated value of the call buy was over $1,200,000.  It’s not readily clear what motivated the call buyer to make such a large bet, though we will likely see some news over the next 1 to 2 weeks that will get everyone else up to speed.

El Paso Pipeline Partners (EPB) announces Q2 earnings on July 14, 2014, so it is certainly possible that positive earnings info has leaked today.

Given the large options play, we like El Paso Pipeline Partners (EPB) common stock for our portfolio, both for the upside potential, but also for the 7.13% dividend yield.  Can’t beat those odds.

Here’s the stock chart on El Paso Pipeline Partners (EPB)