Traders buying calls for a quick pop in this medical device name rather than owning shares outright

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Traders buying calls for a quick pop in this medical device name rather than owning shares outright
France Dernières Nouvelles,France Actualités
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Intuitive Surgical (ISRG) is scheduled to report earnings Thursday after the bell.

Right now the options market is implying a move of greater than 6.6%. This is above the 10-plus year average earnings related move of 5.5%, but below the 7.2% earnings moves seen over the most recent two years. Intuitive is up over 42% over the past 12 months, but only 3.8% of those gains came this year. The consensus view is for 1.42 in adjusted EPS on just under $1.8 billion in revenue, according to FactSet, which would be increases of 19% and 13.5% respectively year-over-year.

mountain Intuitive Surgical , 12 months Call volume was slightly above the 20-day average and put volume slightly below. That combined with Wednesday's outperformance suggests that investors are leaning slightly bullish into earnings. The most active contract, the October $285 calls, traded 445 contracts at an average price of $6.26/contract. Buyers of those calls are risking about 2.3% of the current stock price on a bullish bet that the stock could rally through week's end.

would need to move 5.9% higher over the next two days just to break even on those calls, and they have a relatively low 32% probability of profit for the buyer. That said at over 44 times forward earnings, a relatively high 1.

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