Option volume has ramped up today on KeyCorp (KEY), with activity rising well beyond the usual level on both the call and put side of the tape. Taking a closer look at some of the major block trades on this regional banking issue, it appears that a single spread strategist is responsible for a healthy portion of this option volume.

Specifically, the trader purchased a block of 10,000 June 10 calls for $0.50 each, and simultaneously sold 10,000 June 8 puts for $0.25 each. The result was a net debit of $0.25 per pair of contracts -- which means the speculator can begin collecting profits on those purchased calls if KEY rallies beyond $10.25 by June expiration.

Continue reading Buyout Buzz Inspires Bullish KeyCorp Spread

Buyout Buzz Inspires Bullish KeyCorp Spread originally appeared on BloggingStocks on Thu, 03 Mar 2011 17:00:00 EST. Please see our terms for use of feeds.

Rumors have been circulating for almost a month about Borders' (BGP) possible bankruptcy filing. People familiar with the situation told The Wall Street Journal that the filing could come as early as the middle of this month.

Borders has been trying to hold off the filing by delaying payments to vendors. But this is only temporary. Now the matter has reached a critical stage. The company has obtained about $500 million to $550 million in debtor in possession financing that would keep the company operating after a court filing.

Continue reading Borders Nears Possible Bankruptcy Filing

Borders Nears Possible Bankruptcy Filing originally appeared on BloggingStocks on Wed, 02 Feb 2011 10:00:00 EST. Please see our terms for use of feeds.

Boeing (BA - option chain) stock is trading lower today on conflicting reports about the company's timeline for the debut of its highly-anticipated, but much-delayed 787 Dreamliner. Aviation Week published a report late Friday that the company has told several customers that delivery of its 787 Dreamliner will be delayed by up to 10 months, but Boeing denies this report, saying it intends to meet the current delivery date of Q1 2011. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on BA.

Continue reading Boeing Could Be Facing Even More 787 Delays

Boeing Could Be Facing Even More 787 Delays originally appeared on BloggingStocks on Mon, 08 Nov 2010 13:00:00 EST. Please see our terms for use of feeds.

Continue reading EMC Lifted by Buyout Rumors

EMC Lifted by Buyout Rumors originally appeared on BloggingStocks on Thu, 14 Oct 2010 14:00:00 EST. Please see our terms for use of feeds.

Continue reading Qualcomm Rises on Apple Rumors

Qualcomm Rises on Apple Rumors originally appeared on BloggingStocks on Thu, 30 Sep 2010 13:00:00 EST. Please see our terms for use of feeds.

Continue reading Dean Foods Takeover Speculation Resumes

Dean Foods Takeover Speculation Resumes originally appeared on BloggingStocks on Wed, 01 Sep 2010 13:40:00 EST. Please see our terms for use of feeds.

Continue reading Genzyme Lifted by Takeover Speculation

Genzyme Lifted by Takeover Speculation originally appeared on BloggingStocks on Thu, 29 Jul 2010 13:30:00 EST. Please see our terms for use of feeds.

On the final trading session before Christmas, Apple, Inc. (AAPL) shares hit an all-time high thanks to a published report hinting that another product announcement may be rolling in. On December 23, the Financial Times reported on its Tech Blog that Apple "has something big up its sleeve for next month."

The main reason for this speculation is that the tech company has booked a stage at the Yerba Buena Center for the Arts (YBCA) in San Francisco for "several days in late January." Apple has used this venue to make major announcements in the past, and the speculation is that Apple is going to make a major product announcement at the end of January. The blog quoted Piper Jaffray analyst Gene Munster as saying, "We believe there is a 75 per cent likelihood that Apple will have an event in January and a 50 per cent chance that it will be held to launch the Apple Tablet."

Continue reading Apple Stock Higher Amid Rumors of a New Product

Apple Stock Higher Amid Rumors of a New Product originally appeared on BloggingStocks on Mon, 28 Dec 2009 16:30:00 EST. Please see our terms for use of feeds.

Haven't had enough Tiger Woods news lately? Are you absolutely obsessed with the comings and goings of Alex Rodriguez, Derek Jeter and their respective love lives? Well, the newest entrant into the world of sports reporting may keep you up to date on just that, and more. TMZ has become a major name in the world of celebrity news, and is now expanding its reach into the world of sports.

The main reason for this move is that TMZ will no longer be tied to AOL (AOL), which should make it easier for Harvey Levin to introduce a sports-related Internet site. The celeb happenings of the past year have helped to cement the validity of TMZ, but advertising sales are on pace to come in $10 million shy of a year ago. TMZ itself has evolved from a scoffed-at website that paid for tips and hints to major news stories to an "effective news-gathering operation of a certain kind" according to Time Warner (TWX). TMZ came into its own this year, with the site's popularity exploding thanks to its report that Michael Jackson passed, which came in an hour before the "most mainstream news organizations."

Continue reading A New Entry into Sports Reporting: TMZ?

A New Entry into Sports Reporting: TMZ? originally appeared on BloggingStocks on Mon, 28 Dec 2009 13:30:00 EST. Please see our terms for use of feeds.

Continue reading Retail figures push oil lower ahead of today's inventory report

Retail figures push oil lower ahead of today's inventory report originally appeared on BloggingStocks on Wed, 14 Jan 2009 11:21:00 EST. Please see our terms for use of feeds.

The SEC is trying to stop Wall Street players from spreading rumors that sink stocks, as I posted yesterday. The reason such rumors matter is because there are many companies that are unable to defend themselves from rumors. Bear Stearns comes to mind as an example. I think if someone tried to spread a rumor that Goldman Sachs Group (NYSE: GS) or Berkshire Hathaway Inc. (NYSE: BRK.A) were heading for bankruptcy, the rumor would not get foo far.

But if a company lacks such a strong reputation, its CEO needs to be prepared to respond effectively to such rumors. And I really don't think it should be difficult to mount an effective defense. In my mind, the CEO should be able to provide credible answers to two questions:

• Cash flow. How large are the company's short- and medium-term liabilities and how many times do the market value of its short- and medium-term assets cover these liabilities?
• Debt default. What are the company's key loan terms and what specific assurance can the company provide that it is in compliance with these terms?

Continue reading How public company CEOs can squash false rumors

How public company CEOs can squash false rumors originally appeared on BloggingStocks on Tue, 15 Jul 2008 16:29:00 EST. Please see our terms for use of feeds.

The Wall Street Journal

SEC hits 50 hedge funds with subpoenas in rumor probe originally appeared on BloggingStocks on Tue, 15 Jul 2008 11:35:00 EST. Please see our terms for use of feeds.

Shame on short sellers for destroying the financials! originally appeared on BloggingStocks on Mon, 14 Jul 2008 17:21:00 EST. Please see our terms for use of feeds.

SEC looks to crack down on rumors originally appeared on BloggingStocks on Mon, 14 Jul 2008 10:10:00 EST. Please see our terms for use of feeds.

MGL Asset Management Group's press release purporting to offer $7.25 per share for Krispy Kreme Doughnuts (NYSE: KKD) was pretty quickly debunked as illegitimate and, very probably, an effort to hype the stock for a quick buck. Jon Ogg reported on the mysterious offer on our sister site, BloggingBuyouts.

The stock jumped on the news of the offer, but quickly gave up all the gains and then some after media and analyst reports dismissed the offer. But anyone who jumped on the stock at the sight of the press release got burned.

How can you prevent this from happening to you? A good rule of thumb: When you're looking for information on material developments, look to the SEC filings. The offer was made solely through a press release -- something that anyone with a few hundred bucks to pay the wire fee could send into the hands of millions of investors in a few minutes. Until you see something about the "offer" in the SEC's Edgar Database, it should be regarded as a rumor. I wrote about a similarly non-materializing offer at Trans World Entertainment (NASDAQ: TWMC) back in November.

Another solution is to leave the "in-play" trading to the pros -- it's all about information and you're unlikely to have an edge. If you see a news item that a company has received an offer, don't jump in.

What exactly is a takeover rumor? Be skeptical originally appeared on BloggingStocks on Sun, 06 Jul 2008 15:10:00 EST. Please see our terms for use of feeds.

Continue reading Meg Whitman and Mitt Romney: Oh, the gut wrenching horror of it

Meg Whitman and Mitt Romney: Oh, the gut wrenching horror of it originally appeared on BloggingStocks on Thu, 27 Dec 2007 14:40:00 EST. Please see our terms for use of feeds.

Shares in chip-maker Micron Technology, Inc. (NYSE: MU) are trading higher on rumors that Samsung Electronics may buy part of their business. The South Korean Electronics giant is denying the report. Micron Technology of the U.S. is the world's leading producer of CMOS image-sensing chips. Micron three years ago invested heavily in image-sensor chips as a hedge against fluctuations in demand and prices of memory chips. Business has been very week as prices for these chips have plummeted. That being said, chip-makers have started cutting production to create better pricing.

Morgan Stanley (NYSE: MS) analyst Atif Malik said he understood why investors are getting excited about a potential price rebound for Micron shares as chip makers are starting to cut production in some less-profitable types of chips.

While Samsung denies the rumors, I wouldn't be surprised if a deal gets done. Why? Because in October Samsung bought Israeli non-memory chip developer TransChip Inc. to help strengthen its research and development capability in the CMOS chip business.

With Micron shares down more than 35% from their 52 week high, Samsung would be able to establish a real foothold in this business for cheap.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. Disclosure: Writer has no position in any stock mentioned as of 12/6/07.

Will Samsung save Micron? originally appeared on BloggingStocks on Thu, 06 Dec 2007 17:12:00 EST. Please see our terms for use of feeds.

A Wall Street source has told me that there is a rumor floating around that current Treasury Secretary Hank Paulson is leaving his post to take over Citigroup Inc. (NYSE: C).

Naturally, this rumor interests me because I have posted wistfully about this outcome for the last several months. While Paulson may not be the greatest Treasury secretary in American history, he had an excellent track record at Goldman Sachs Group (NYSE: GS) and he would do his reputation a big favor if he could step into Citigroup and save it from ruin.

Citigroup has been hurting badly all year. In the first part of 2007, it suffered because its costs were growing faster than its revenues. Then it missed its third-quarter earnings numbers and announced a much bigger-than-expected write-down of assets related to subprime mortgage-backed securities. This culminated in the departure of Citigroup's CEO, Chuck Prince on November 4.

Continue reading Wall Street Rumor: Paulson leaving Treasury to run Citigroup

Wall Street Rumor: Paulson leaving Treasury to run Citigroup originally appeared on BloggingStocks on Wed, 28 Nov 2007 12:20:00 EST. Please see our terms for use of feeds.

One of my favorite Jim Cramer-isms is "Commandment No. 5" -- Tips are for waiters. Here's what he writes:

You know that the best moves are takeovers and you are convinced that if you can catch one, it will make up for all the bum steers and bad bets you have made. Tips are winning lottery tickets in most people's eyes.

That's the reason I've had to default to a simple analogy, tips are for waiters, to remind myself how stupid tips really are. Does it occur to you, on hearing the tip, that if the person telling you that Nokia is going to buy RIM really knows that's going to happen, the person is an insider and is breaking the law, and you could get in trouble, too? Does it occur to you that if the person isn't an insider, he doesn't know? There simply is no way a tip like that can work. Leave it for the waiter.

That's what investors should be keeping in mind as they watch shares of E*Trade (NASDAQ: ETFC) surge on extraordinarily vague takeover rumors. Shares were up as much as 25% on rumors that Schwab and Ameritrade were interested in buying the beleaguered broker. Where did these rumors come from? Ah, yes. "A source." And who's to say that "the source" isn't some clown holding a ton of E*Trade shares that he needs to get rid of -- for 25% more than they were trading before the rumor?

Everyone knows E*Trade could be in play -- any time a stock tanks that much, there are always going to rumors. But no one really knows what's going on, and buying E*Trade on the rumor is just mindless speculation.

As Doug McIntyre wrote, "E*Trade may be worth over $5, but it could also be worth a lot less."

Don't buy E*Trade on the rumors originally appeared on BloggingStocks on Sat, 24 Nov 2007 18:10:00 EST. Please see our terms for use of feeds.

Continue reading Goldman Sachs (GS) higher on good news from competitors

Goldman Sachs (GS) higher on good news from competitors originally appeared on BloggingStocks on Fri, 26 Oct 2007 11:17:00 EST. Please see our terms for use of feeds.