Massive Exponential Volume in Tenet Options & Stock, More to Come? (THC)

Posted in General, Options 
December 10th, 2010

Tenet Healthcare Corp. (NYSE: THC) is trading more volume than we can recall ever seeing.  While the company has never really recovered its former glory, the hospital told Community Health Systems Inc. (NYSE: CYH) no to its $6.00 buyout offer.  The common belief now is that Community Health will have to raise its offer price if it wants the company.

Tenet shares have been unbelievably active today.  With just under an hour of trading before the market closes, the gains have been a whopping 54% to $6.63.  What is even more impressive is the trading volume.

Tenet has traded MORE THAN 200 MILLION SHARES versus and the average volume is not even 8 million shares.

Options have been through the roof: JAN 2011 $7.50 CALLS show 17,408 contracts traded versus a prior open interest of 21,921 contracts; the JAN 2011 $5.00 PUTS have traded some 11,513 contracts versus a prior open interest of 14,055 contracts.  The FEB-2011 $7.00 CALLS have traded 9,354 contracts versus a prior open interest of only 45 contracts against 2,164 of the $6.00 PUTS.  The MAY-2011 $7.00 CALLS have traded 15,211 contracts against an open interest of only 31 contracts.

JON C. OGG

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