I have been trading this stock profitably for the last year, both in options and common. I see an excellent opportunity now, albeit high risk. There are currently in talks with Apple, Cisco, and other big players, and I sense a buyout, or a settlement.
Here is the way I am playing it now. If we get a buyout, we could see a double or triple from today's $13 price. If nothing happens within the next year, the stock could easily drift back down to five or six dollars a share. But, I do expect activity, given my recent conversation with management.
In the past when I've spoken with these guys, they have been very forthcoming with their plans and opportunities. This conversation was markedly different. Basically I was told that their new attorneys have told them not to speak with shareholders, because they didn't want to run the risk of jeopardizing current negotiations. I was told that the current situation was intense, and that management believes the outcome would be positive.
Given the change in management's tone, I am going to be a buyer of January 2012 calls. If there were to be a buyout, we should see an announcement before 2012. That's just my guess, but given the tone conveyed by management, I believe that's accurate. I would expect volatility going forward, and these calls could double or drop in half, throughout this unstable time.
Disclosure: I am long VHC.