BIG OPTIONS: Talisman Energy (TLM), Rock-Tenn Co (RKT), Allegheny Technologies (ATI)

Was a slow start this morning for unusual options plays, but is now picking up again, after a super busy day yesterday.  More on that later, but for now three unusual options trades have caught our eye so far, including Talisman Energy (TLM), Rock-Tenn Co (RKT), and Allegheny Technologies (ATI).

 

Rumors were swirling early this morning about a potential buyout of Canadian energy company Talisman Energy (TLM)by a Spanish firm.  Well, that seems to be unofficially confirmed by a large call buy in TLM this morning.  A trader bought 14,147 August $11 calls, all at the ask price.

 

Now, it looks like Talisman is halted as of 10:22 at a final price of $11.11 up $1.26 on the morning.  We’re guessing this rumored deal is done, or the exchanges have halted asking for more details from the companies involved after that hefty call buy.

 

A trader hit up Rock-Tenn Company (RKT) in a small, subtle, but unusual opening trade of 850 of the September $100 calls of RKT.  They paid $2.05 at the ask for the calls.  Not a huge trade, but still interesting.

rock-tenn-company-logo

RKT is trading up 74 cents today to $95.33 on average volume.  Rock-Tenn share price has been knocked down considerably over the past three weeks, having traded as high as the $106 area just three weeks ago.

 

This call buy could just be a value play, as the trader expects the company’s share price to rebound, or more likely they know something about the July 30 earnings report that we don’t.  We’ll have to wait and see on this one, but will likely join the party in a small way on this one, before the earnings release.

 

Not the usual ATI we see a lot of, but this time Allegheny Technologies (ATI) is seeing an interesting call buy this morning.  One trader picked up 3,256 of the October $45 calls in ATI, while the stock was trading well down.  The stock is sill down $1.49 to $42.35 this morning.

 

The company just reported earnings yesterday, July 22, and were not well received. So this could just be a simple value play, but with this kind of call volume, we tend to think there is more to it than value.  This could be a precursor to an upgrade and price target hike by a big firm, or some other material event that we plebes won’t know about until it hits the newswires.
That’s all for now.