Upside option positions are delivering massive profits in Delek US Holdings, Inc. (DK).
On May 22, Market Rebellion’s Unusual Activity service identified the purchase of 6,000 June $20 call options at $0.60-$0.65 per contract, with DK shares trading at $18.25, significantly exceeding the strike’s previous open interest of 173 contracts.
The timing proved particularly fortuitous, coming amid ongoing positive momentum around the diversified downstream energy company’s strategic transformation efforts and improved operational performance.
Those June $20 calls have traded as high as $3.00 today with the stock at $22.95, delivering impressive returns of approximately 361.54% to 400.00% from the initial entry price range of $0.60-$0.65. Meanwhile, DK shares have gained approximately 25.75% from their initial trading level around $18.25, demonstrating how options can deliver significantly amplified returns compared to simply owning the underlying stock.
This performance illustrates the power of options leverage when the directional thesis proves correct, though it’s important to note that this same leverage can work against traders when market moves go in the opposite direction.
The strong move in DK comes as the petroleum refining company benefits from several fundamental catalysts that have emerged since the original trade was spotted.
Delek US Holdings specializes in petroleum refining, logistics, and renewable fuels, operating refineries across the southern and western United States. The company has been actively working to improve profitability through asset sales and operational improvements as part of its strategic transformation.
DK closed this session at $22.77, up 2.87% on the day and up significantly from the $18.25 level when the original call activity was spotted.
