Airlines have been making headlines all week and for all the wrong reasons, with United Continental UAL – NYSE reeling from backlash over a viral video and Delta Air Lines DAL – NYSE fading after announcing earnings.
On the brighter side, Spirit Airlines SAVE – NASDAQ appears to have broken out of a lengthy consolidation pattern. Not going entirely unnoticed, a sharp trader bought 2,000 SAVE April 55 calls earlier today.
At $0.70 per contract, this trade only cost $140,000 but what’s important is the relative size as SAVE averages 239 call options traded per day. Given the break-even price of $55.70, SAVE has to increase 3.1% for this trade to pay off by expiration.
If the airline sector can quickly recover from its recent blunders, SAVE could end up flying the highest.
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