Options Bulls Blast Oil & Gas Stock After Merger Update

Southwest Energy will merge with Chesapeake Energy later this year

Laura McCandless

Deputy Editor

Sep 19, 2024 at 2:30 PM

Call traders are blasting Southwest Energy Co (NYSE:SWN) today, after news that the company's merger with Chesapeake Energy (CHK) will occur in the fourth quarter of this year. The merger, in which CHK will buy out SWN for $7 billion, was delayed in April.

So far, SWN has seen 101,000 calls exchanged in comparison to just 4 puts, which already represents 30.9 times the stock's average daily options volume. The majority of this volume is made up of European style options, while in the American style, the January 2025 7-strike call is popular.

At last glance, SWN was up 4.2% to trade at $6.61, and breaking into positive territory for 2024. The stock is extending a bounce off support at the $6 region that has kept losses in check for a year, and trading at its highest levels since July.

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