Breaking Down Today's Big SunPower Corporation (SPWR) Spread

SunPower Corporation's January 2015 series of options has been popular today

by

Published on Nov 20, 2014 at 2:41 PM
Updated on Apr 20, 2015 at 5:32 PM

SunPower Corporation (NASDAQ:SPWR) is up 3.7% this afternoon, after last night announcing restructuring measures that will cost up to $25 million. At last check, the stock was sitting at $29.12. Meanwhile, activity in the options pits is running fast and furious -- especially on the call side, where intraday volume more than doubles the expected amount.

Getting into the details, the three most active options are the January 2015 29- and 32-strike calls, and the 27-strike put. It appears a bullish spread totaling 7,000 contracts is being opened at the two call strikes, while a number of puts are being sold to open to help finance the spread. In other words, the trader expects SPWR to rally up to $32 over the next two months.

Taking a step back, it's been a tough year for SunPower Corporation (NASDAQ:SPWR). Even after today's gains, the shares are in negative year-to-date territory, and have underperformed the broader S&P 500 Index (SPX) by almost 28 percentage points during the past three months. As a result, traders at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have been upping the bearish ante in recent weeks.


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