FEYE has traded in a tight range for all of 2021
Amid all the aftermath of the ransomware attack on the United State's Colonial Pipeline, cybersecurity stocks like FireEye Inc (NASDAQ:FEYE) are in focus today. Sources in the industry say FireEye is among the companies dealing with the attack on the fuel pipeline operator. Last seen up 1.6% to trade at $19.63, FEYE options traders are taking a flier on calls at a rapid rate.
More specifically, 60,000 calls have crossed the tape so far today, volume that's five times the average intraday amount and almost 14 times the number of puts traded. The most popular by far is the May 20.50-strike, where new positions are being opened. Buyers of these calls are banking on FEYE to keep climbing through the end of next week, when the contracts expire.
This preference for calls is nothing new, though. The security's 10-day call/put volume ratio of 7.08 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) indicates calls have outflanked puts by a more than seven-to-one ratio in the last two weeks.
After surging to a five-year high of $25.53 on Dec. 23, FEYE has shed almost 15% in 2021. The $19 level has emerged as a stable floor during this timeframe, while the shares have not closed above $22 since Jan. 25.
Speculating on FireEye stock's next move with options could be a prudent play. FEYE's Schaeffer's Volatility Index (SVI) of 37% sits in the bottom percentile of its annual range, implying that options players are pricing in low volatility expectations at the moment.