Bullish Activity in HCA Holdings

HCA Holdings (HCA) is on the highs today and big investors are getting behind it as well. The Nashville-based owner and operator of for-profit hospitals is up 20.6% YTD trading at $57.83. The stock has been performing well over the past year and the bullish trend looks to continue with HCA trading well above the cloud.

The healthcare services provider is looking to benefit from increased volume due to newly insured individuals from the Affordable Care Act. The company’s CFO said last week that they are open to the idea of expanding through M&A activity as well so that could be a reason for the recent spike in the stock. The option activity in the name is strong with traders agreeing with analyst consensus and getting long against small open interest with high volume.

Higher highs and lower lows recently suggest a continuing bull run so we will be keeping our eye on HCA. Let’s look at a trade.

The Trade:

Buy Jul 60 Call for $0.75

Risk: $75 per 1 lot

Reward: Unlimited

Breakeven on expiration: $60.75


The Greeks:

Delta: Long

Gamma: Long

Theta: Short

Vega: Long