Large, Unusual Call Buys in Coach Inc (COH) and Lifetime Fitness (LTM)

Just when things were getting a little dull, a little more unusual call buying started up again this afternoon.  Two of the most interesting trades were seen in the calls of Coach Inc (COH), and in Lifetime Fitness (LTM), though on a smaller scale on LTM.

We saw saw a big trade last month in calls of Coach Inc (COH), and now today a trader seems to think that it is going higher again in the medium term.  A trader bought 7,808 COH February $41 calls. They paid $1.25 at the ask, for those calls that expire in February.  That makes for a good sized bet with a transaction value of just under $1,000,000.

Coach Inc (COH) is currently trading at $37.37 up 85 cents on the day, or 2.27%. Of course the stock jumped up big as the call buy happened, as did the volume.  RIG has a 52 week high of $57.95, and a low of $33.39 for the year.  It’s traded a well below normal volume today with almost 2.4 million shares trading by 2:50 pm today.  It’s average volume traded is in the 4.5 million area, though volume is picking up since the big call buy.

Coach-COH-logoCoach Inc (COH)announces quarterly earnings October 28 but we’re pretty sure this call buy has nothing to do with earnings. I think you can expect an analyst firm to announce an upgrade or price target raise very soon.

We like this trade given it’s size, and the market, and the calls are still only bidding $1.20 and ask is $1.25 so we are jumping on this bandwagon.

 

Meanwhile another trader seems to think that Lifetime Fitness (LTM) is going higher, though with much less conviction than the COH trader.  The trader bought just 684 of the LTM November $50 calls. They paid $1.75 at the ask, for those calls that expire in November on the 21st.  That makes for a transaction value of almost $120,000. Still a nice sized bet on a small little followed company.

Lifetime Fitness (LTM) is currently trading at $47.12 up 39 cents on the day, though well off its earlier low of the day of $46.79. LTM has a 52 week high of $56.78, and a low of $38.01 for the year.  It’s traded extremely low volume today, and well below normal volume with 190,000shares trading by 3 pm today compared to average vol of 760,000 shares.

Lifetime Fitness (LTM)announces quarterly earnings October 23, but we suspect this little call nibble is related to either some analyst update to come soon, or possibly some sort of merger, partnership, buyout of another company etc.  Whatever it is, we like it, as it is extremely unusual action.