Time Warner (NYSE: TWX) is recently up 53 cents to $14.45.
The WSJ reported Microsoft (NASDAQ: MSFT) and TWX's AOL unit are in advance discussions on a possible tie up.
TWX is expected to report Q2 EPS on August 6. On May 21, 2007 TWX declared a one-time dividend of $10.9 billion to its stockholders, payable just prior to separation of Time Warner Cable (NYSE: TWC); TWX will receive $9.25 billion of Time Warner Cable's dividend.
TWX call option volume of 25,158 contracts compares to put volume of 20,636 contracts. TWX August option implied volatility of 43 is above its 26-week average of 35 according to Track Data, suggesting larger price movement.
Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com
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