Option update 5-14-07: CLF, MOS spike on speculation


Cleveland-Cliffs (NYSE: CLF) -- calls bid up aggressively on heavy volume on buyout chatter. CLF, a producer of iron ore pellets, is recently up $1.75 to $75.30 on unconfirmed take over chatter. CLF has a market cap of $3 billion. CLF is expected to file its 1st quarter 2007 form 10-Q in early June. CLF May 75 calls have traded 105 times on transaction volume of 1,712 contracts above its open interest of 935 contracts. CLF May 75 calls are bid $1.70 above its theoretical value of $1.05. CLF May 80 calls have traded 69 times on transaction volume of 1,818 contracts above its theoretical value of 626 contracts according to Track Data. CLF May 80 calls are bid 45 cents above its theoretical value of 04 cents, suggesting hedging for upside risks.

Mosaic Co. (NYSE: MOS) -- volatility & volume Spikes on buyout Speculation. MOS, a producer & marketer of concentrated phosphate and potash crop nutrients, was spun out of Cargill in 2004. MOS is recently up $1.16 to $30.63. MOS is frequently mentioned as a take out target of Potash Corp. (NYSE: POT). MOS call option volume of 4,791 contracts compares to put volume of 643 contracts. MOS June option implied volatility of 48 is above its 26-week average of 36 according to Track Data, suggesting larger for upside price risks.

Option volume leaders today are: Dendreon Corp. (NASDAQ: DNDN), Advanced Micro Devices (NYSE: AMD), Apple Inc. (NADSAQ: APPL) and Mylan Labs (NYSE: MYL).

Daily Option Update is provided by Stock Options Specialist Paul Foster of theflyonthewall.com.

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Last updated: February 13, 2012: 11:57 AM

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