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Originally submitted at 2:00 PM EST…. Despite the markets trading a bit lower today there was a lot of call activity today based on takeover chatter in various sectors, as the bullish move in the markets coupled with a budding M&A market have speculators active. Early morning action was in Bunge (NYSE: BG), with Monsanto (NYSE: MON) rumored to be offering a $75 price tag, and 24,000 calls traded, a lot of new opening buyers with 50% of the action offer side, with the large players buying the out of the money January $70 calls in size.
Then a rumor that News Corp (NYSE: NWS) is looking to takeout Monster Worldwide (NYSE: MWW) at $23.50 per share hit, and today 43,800 calls have traded, 52% offer side buys with 100+ lots of November and December $15 calls being bought, 22X average call volume.
A rumor that Nucor Corporation (NYSE: NUE) has a $60 offer for Schnitzer Steel (NASDAQ: SCHN) never really gained any traction. Riverbed Technology (NASDAQ: RVBD) was also back in the M&A chatter as 9,700 calls traded, half the action offer side, with buyers in December $22.50 calls.
The most explosive action came late in the day as Colgate (NYSE: CL) shares spiked 4% higher and IV jumped 56% as a UK newspaper mentioned that a merger with Reckitt may be close. 37,500 calls traded with 57% offer side, also seeing some sizable chunks of November $85/$90 calls and December $85/$90 calls being bought in strength.
Later in the day came wod that Ameritrade (NASDAQ: AMTD) might be looking to buy E*TRADE Financial (NASDAQ: ETFC) also began to hit trading floors and call action jumped…. at least for a sub-$2.00 stock.
JOE KUNKLE, OptionsHawk.com
NOVEMBER 17, 2009
Poniard Pharmaceuticals, Inc. (NASDAQ: PARD) recovered off lows big-time yesterday after the company announced an updated positive clinical data from its Phase 2 trial of Picoplatin in colorectal cancer and new Phase 1 cardiac safety trial results. Shares are continuing the recover this morning with a 10.9% gain to $2.71 on over 425,000 shares as of 8:26 AM EST. This is on the heels of a huge drop from $7.58 on Friday to $1.83 on Monday after a failure of a picoplatin study in lung cancer trials.
JON C. OGG
SunPower Corporation (NASDAQ: SPWRA) (NASDAQ: SPWRB) is taking it on the chin. We have seen at least two analyst downgrades after last night’s disclosure that it was “reviewing unsubstantiated accounting entries.” In short, accounting irregularities may be there. No one wants to see this in a stock, particularly in a battered solar stock. At 8:44 AM EST we have seen some 485,000 shares trade hands versus an average volume of 2 million shares per day and the stock is down over 14% to $27.23.
The B shares are “SPWRB” are down 12.5% at $20.90, but those shares trade less than 500K per day.
JON OGG
CommVault Systems, Inc. (NASDAQ: CVLT) has been trading higher all day on the Goldman Sachs analyst upgrade to ‘Buy’ this morning.  The gains are large and we are seeing some options trading as a result. The actual share volume is active considering this company itself, but is still far short of what we would call extremely active in buyout speculation trading.
Joe Kunkle over at OptionsHawk.com this morning noted that calls are trading 5,068 versus average volume of 774 already today with implied volatility increasing 11.7% to 48%, and with shares at just $22.70 there are buyers at the offer of December $25 and $30 calls. My best explanation for this is that with NetApp (NTAP) reporting earnings on 11/18/09 after the close we could see our next big Tech M&A deal with CommVault (CVLT), a small niche player with huge growth potential, the Company NetApp could acquire. There is also some bullish action in NetApp with a buyer of 2,000 November $32 calls earlier this morning, so this action adds up to a potential deal on the horizon.
Anything is possible in technology M&A and the company is in data and information management software applications and related services. It is in the sweet spot of the sector. But insiders also sold over $1 million worth of stock last week as a sale window opened up. While Dell Inc. (NASDAQ: DELL) and NetApp, Inc. (NASDAQ: NTAP) we have also heard of other likely suitors that are possible but were not rumor-mill buyers.
At 12:40 PM EST we have shares up 5.7% at $22.54 on over 386,000 shares. Average volume is only 342,000 shares, so any interest here is probably something all relative. This $22.92 intraday high was also a new 52-week high.
JON C. OGG
Sprint Nextel Corp. (NYSE: S) appears to be one the largest S&P gainers this morning. The only news was the repayment of a $1 billion loan, but real news out today causing the run-up is the Oppenheimer upgrade to OUTPERFORM from Neutral. The price target was also raised to $6.00 from a prior $4.00 price target. At 9:46 AM EST we have shares trading up almost 11% at $3.44 on 15.5 million shares. Average daily volume is 55 million shares and the 52-week trading range is $1.35 to $5.94. We would also note that this is already seeing options activity picking up this morning in the longer-dated expiration months.
JON C. OGG
Netlist Inc. (NASDAQ: NLST) is rising yet again after being on a tear last week. This stock came under attention because of its launch of Netlist’s HyperCloud memory module for servers. This morning the company said that at Supercomputing 09, it is demonstrating the world’s first 16GB 2 virtual rank double-data-rate three, registered dual in-line memory module. Average volume was only about 150,000 last week but now the average volume is approximately 300,000 shares. At 8:40 AM EST we have already seen 350,000 shares trade hands and the stock is up 14% at $5.10. The 52-week trading range was $0.14 to $4.83. Last Tuesday this was not even a $1.00 stock to show how much it has risen. And the stock more than doubled in price on Friday on over 11.4 million shares. If this is not an inflection point for traders, that must be close. The caveat is that this is only an $88 million market cap even after last week’s exponential rise.
-JON OGG