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Zomax (ZOMX – 8-1/16) is a maker of CD-ROMs for multimedia publishers. This morning, the company reported that it expects third-quarter earnings of 17 cents per share, which would fall short of analysts' predictions of 28 cents per share. Not surprisingly, investors have punished the stock in reaction to this warning, sending it onto the Nasdaq new lows list. The shares have plunged over nine points, or greater than 53 percent, to drop to levels not seen since late June 1999.
The options crowd, though, apparently has taken today's news as a chance to add call positions. The out-of-the-money October and January 10 calls have been active on volume of 503 and 519 contracts, respectively. This trading should amount to some new positions, as the October 10 call has open interest of only 26 contracts, while open interest on the January 10 call stands at 69 contracts.