Post Holdings, Inc. (POST) is a St. Louis based consumer-food producer that distributes its products to grocery stores and other food retailers across the United States and Canada. As of the time of this post (10:15AM CST), POST is currently trading at 41.17, up 3.76% on the day. The stock is currently in the lower portion of its 52 week trading range of 30.94-60.63, but has rallied hard today after some unusual options buying activity hit the tape and was flagged by OptionHacker.
At approximately 9:12AM CST, OptionHacker detected and flagged a large block by of 2,500 contracts of the POST Mar ’15 45.0 strike calls. The calls were bought at the ask for 1.00, and went off at a time when the spread was extremely wide, indicating a trader looking to waste no time getting filled on this large order. The open interest in this strike was only 279 contracts going into the day, further confirming that this was an opening buy order looking to profit from continued upside in POST going into the March monthly options expiration. With an initial cash outlay of approximately $250,000 before commissions, this trader was rewarded almost immediately after his timely purchase, as POST rallied up through the 40.25 level, trading as high as 41.51 and pushing the price of these options up as high as $1.50. As OptionHacker detected this opening transaction before the stock rallied, we were able to trade a profitable position in POST alongside this large buyer, and will be watching the stock closely for further upside.
Trade: Trader bought 2,500 of the POST Mar 45 Calls for $1.00
Risk: $100 per 1 lot
Reward: Unlimited
Breakeven: $46.00
These calls traded as high as $1.50 today meaning a trader could have locked in profits of 50% in just over an hour.
Andrew Keene
KeeneOnTheMarket.com
