Unusual Friday Options Trading Review: Eastman Kodak (EK)

Posted in General, Options 
September 19th, 2009

Eastman Kodak Co. (NYSE: EK) was one of this week’s more unusual options traders.   We think that this financing deal from KKR, which we may now jokingly call Kodak Kodak & Rubbish, is a two-sided deal, and that sword can cut both ways.  If Kodak does not get its act together over the next year or two, they have let the barbarians into the gate.   Sellers attacked and took the stock down from over $6.50 to $5.54 from Wednesday’s close to Friday’s close.  Share volume in common stock was very elevated with over 30 million shares on Thursday and Friday, and this was reflected in options trading.  The OCT-2009 expiration saw over 14,000 calls and over 17,000 puts trade.  We saw over 10,000 of the JAN-2010 Calls trade, but the biggie was the APRIL-2010 CALLS with over 40,000 contracts traded.  There were even about 10,000 contracts of the various JAN-2011 CALL contracts that traded and 55,000 of the JAN-2011 $10 PUTS that traded.  Much of this looks to be hedging transactions, but the bets are being made nonetheless. -JON OGG

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