Maker of tasty pastries, lunch meat, and shoe polish (?) Sara Lee Corp. (NYSE: SLE) surprised Wall Street this morning when it reported a fourth-quarter loss of $14 million, or two cents per share. Last year in the same reporting period, SLE lost $672 million, or 95 cents per share. Not only were these numbers an improvement on a year-over-year basis, but they topped analysts' expectations as well. Excluding charges related in part to its Spanish bakery business, the firm banked 29 cents per share, topping per-share estimates of 24 cents. Revenue was off 10% during the quarter to $3.16 billion.
SLE shares have gained 10% in 2009 so far and have jumped nearly 20% during the last three months. In pre-market action, however, SLE is down nearly 3% after early indications of a positive open.
In yesterday's trading, options traders focused on the in-the-money August 10 call, trading nearly 1,500 contracts at this strike, which is now home to open interest of about 3,300. The site of heaviest open interest across all strikes is the out-of-the-money October 12.50 call, home to 11,376 open positions. Those who bought these calls need the stock to rally more than 15% before October expiration in two months. The last time SLE traded at this level was in early October of last year.
Beth works for The Options News Network (www.ONN.tv), which provides daily stock and options commentary. The above comments are not intended as trading advice.
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