Andrea Kramer (akramer@sir-inc.com) The shares of Boston Scientific Corp. (BSX) have advanced more than 17% since the start of December ? a feat accomplished with help from pharmaceutical rival Johnson & Johnson (JNJ), according to Wells Fargo. More specifically, the analysts on Friday said that JNJ's recently disclosed issues surrounding its Nevo heart stent could be "significant," and could even prompt the Dow component to re-evaluate its commitment to its flagging Cordis stent franchise ? which could be a boon for BSX.
Whatever the catalyst, the shares of BSX climbed to their highest perch since mid-March on Friday, with the stock topping out at $7.65. What's more, the security's upward trajectory prompted a slew of short-term call holders to cash in their proverbial chips.
During the course of the session, BSX saw roughly 15,000 calls change hands ? more than double its expected daily call volume. Most popular was the equity's now-in-the-money January 7.50 call, which saw around 5,500 contracts traded ? most of which crossed at the bid price, suggesting they were sold. Plus, call open interest at the now-front-month strike depleted by more than 2,000 contracts over the weekend, confirming our suspicions of sell-to-close activity.
However, even with Friday's bout of profit taking, there's still plenty of optimism among the near-term options crowd. The stock's Schaeffer's put/call open interest ratio (SOIR) of 0.40 indicates that calls more than double puts among options slated to expire within three months. Furthermore, this ratio ranks in the 26th annual percentile, implying that short-term speculators have been more bullishly biased toward BSX just 26% of the time during the past year.
In early trading, the stock has followed the broader equities market into the red, giving up 1.7% to hover just north of the $7.50 level.
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