TriQuint Rallies After Call Buying

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By David Russell

TriQuint Semiconductor (TQNT) is climbing to an eight-year high today, one session after a wave of bullish options activity.

The maker of smart-phone chips rose 2.92 percent to $11.99 and is up 27 percent in the last month. Yesterday investors bought December 11 calls for $0.60 to $0.65. Today those same contracts have almost doubled to $1.10.

TQNT has been riding a secular trend of increasing demand for its circuitry as mobile phones grow more complex and add functionality. It has issued bullish earnings guidance at least five times this year but still trades at a relatively cheap multiple of 13 times forward earnings.

Activity this session is turning to the December 12 calls, which have traded more than 2,100 times against open interest of 541 contracts. Most of the purchases have priced for $0.30 to $0.40. The December 11s also saw follow-on buying for $1, according to optionMONSTER's Heat Seeker tracking system.

Overall option volume in TQNT is 7 times greater than average so far today, with calls outnumbering puts by 60 to 1.

Disclosure: No position