Lifelock Inc (LOCK) is one of several cybersecurity stocks making a big move today
It's been a notable day for the cybersecurity sector, with earnings
sending this stock to decade highs and
weighing on another. While
Lifelock Inc (NYSE:LOCK) has been sinking since reporting earnings earlier this week, the shares are surging today after sources said the company has
hired Evercore Partners to explore strategic alternatives. Suffice it to say, this ought to renew the hopes of bullish options traders.
At last check, LOCK has jumped over 6% to trade at $16.69, and earlier hit an annual high of $17.16. This is just what options traders have been betting on in recent months. Specifically, at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), speculators have bought to open quadruple the number of calls as puts, looking back 10 weeks. In fact, the corresponding call/put volume ratio of 4.01 ranks just 7 percentage points from an annual high.
That said, an ulterior motive may have been in the works. Because 17.5% of Lifelock Inc's (LOCK) float is sold short -- 7.6 times the stock's average daily trading volume -- it's possible short sellers have been
purchasing calls to serve as upside protection. That said,
unhedged shorts may be in a world of hurt this afternoon, and an unwinding of their stock positions could serve as fuel for the fire.
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