Whiting Petroleum (WLL) Bears Step In Amid Buyout Buzz

Whiting Petroleum Corp (WLL) is up over 12% today

Digital Content Group

Mar 9, 2015 at 11:16 AM

Whiting Petroleum Corp (NYSE:WLL) is 12.6% higher today at $38.32, after the company announced it will be searching for a possible buyer, continuing the M&A trend for today. Speculators are wasting little time, as overall options volume is running at 10 times the normal intraday pace. Puts, specifically, are in high demand, with the March 37 strike by far today's most popular contract. It appears some traders are buying to open the puts, in hopes of WLL breaching $37 by the close on Friday, March 20, when front-month options expire.

The preference for puts is just more of the same for WLL speculators, according to data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). The equity's 50-day put/call volume ratio across these exchanges is 1.05, higher than 91% of all readings from the past year.

Analysts, though, are believers of the shares. Seventeen out of 23 covering brokerage firms say WLL is a "buy" or better. Also, the stock saw its price target raised at Barclays to $32 from $27 just this morning.

From a long-term perspective, Whiting Petroleum Corp (NYSE:WLL) has struggled mightily. On Aug. 29, the security touched an all-time high of $92.92, yet since then, has given back almost 59%.

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