Las Vegas Sands rose with an upgrade today, dealing a winning hand to traders.
On April 17, Investitute’s tracking systems found that 3,400 Weekly $57.50 calls expiring this afternoon were purchased for $0.14 to $0.19 with shares at $56.26. Open interest in the strike was a mere 20 contracts before that session began, showing that these were new positions.
Today those calls traded for $1.35, a gain of roughly 700 percent. The stock rose just 4.3 percent in the same time span, underscoring the kind of leverage that can be achieved through options.
Long calls lock in the price where the stock can be purchased, gaining with a rally and providing leverage to the underlying shares. The contracts can quickly lose value if the stock stalls or pulls back but also carry less risk than owning the shares themselves.
LVS was up 2.07 percent today to close at $58.65. Barclays raised its rating on the casino operator to “overweight” from “equal” weight and lifted its price target to $68 from $55 in the pre-market. The firm upgraded Las Vegas Sands and rival Wynn Resorts, citing a recovery in Macau.
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