Occidental Petroleum (OXY) is seeing a significant surge in bullish options activity ahead of its earnings report, with traders favoring call options over puts by a remarkable seven-to-one ratio. Notably, one trader executed a $175,000 call spread, betting on OXY reaching a new one-year high by week’s end. This heightened interest comes as crude prices rise, bolstering sentiment in the energy sector.
With Occidental’s stock having rallied after 10 of its last 12 earnings reports, including a substantial 10% jump following its February results, there is a strong precedent for a positive earnings reaction. The stock has gained 42% year-to-date, outperforming the State Street Energy Select Sector ETF (XLE), which is up 30%. Berkshire Hathaway’s substantial stake in OXY further underscores investor confidence in the company.
Traders should monitor OXY closely as the earnings report approaches, given its historical performance and the current bullish sentiment, which could translate into significant price movement.
Source: cnbc.com