Andrea Kramer (akramer@sir-inc.com) Best Buy Co., Inc. (BBY) was bombarded by call speculators on Monday, after the electronics retailer predicted higher "Black Friday" sales than last year. In an interview with Reuters, Executive Vice President Shari Ballard pointed to "pent-up demand" among consumers, and noted the company's efforts to best rivals like Wal-Mart Stores (WMT), including kicking off holiday promotions earlier and offering free shipping.
By yesterday's closing bell, BBY had seen roughly 14,000 calls cross the tape ? more than tripling its expected daily volume of fewer than 4,800 calls. Most popular were the out-of-the-money December 46 and 47 calls, which saw about 4,500 and 1,500 contracts change hands, respectively. What's more, the majority of the calls traded at the ask price, and call open interest at both strikes ballooned overnight, pointing to buy-to-open activity.
However, the affinity for near-term calls is nothing new for BBY, as evidenced by the stock's Schaeffer's put/call open interest ratio (SOIR) of 0.80. Compared to similar readings taken during the past year, the equity's SOIR stands in the 31st percentile, suggesting that short-term options players have been more optimistically aligned toward BBY just 31% of the time during the past 52 weeks.
Ahead of the bell, BBY is poised to tick higher, with the stock finishing Monday at $44.86 per share.
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