Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 

4-Traders Homepage  >  Equities  >  Nyse  >  CBS Corporation    CBS

Delayed Quote. Delayed  - 09/30 10:01:54 pm
54.74 USD   +0.31%
08:48aDJCBS : Viacom, CBS Move to Explore Merger -- WSJ
09/30DJCBS : Viacom, CBS Form Special Committees to Review Possible Merger ..
09/30DJCBS : Viacom, CBS Form Special Committees to Review Possible Merger-..
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector news 

CBS Corporation : CBS Options Trading Nets Big Gains With Spinoff

share with twitter share with LinkedIn share with facebook
share via e-mail
0
01/18/2013 | 12:15am CEST

--Options prices soar with news of CBS spinoff

--Well-timed bets look set to pull in big gains as CBS shares surge

--One CBS options trade is ready to draw $6.5 million in profit

(Adds details and background.)

 
   By Kaitlyn Kiernan 
 

NEW YORK--CBS Corp. (CBS, CBSA) options have seen a surge of activity over the past six sessions, with the number of outstanding bullish positions increasing 58%. The activity came ahead of a jump in the TV company's stock Thursday on news the company is spinning off some assets.

Those new positions were on track to gain as much as 1,650% after shares rose, which raised some eyebrows in the options industry.

"It's an interesting time period when the trades occurred," said Brian Overby, senior options analyst at online brokerage TradeKing.

Trading in CBS options averaged nearly 27,000 call options daily over the past six sessions, according to Trade Alert data. That compares with an average of just 1,530 over the prior month.

CBS shares rose $3.01, or 7.9%, to $40.95 Thursday, on track to notch their biggest percentage-point gain in 17 months. The shares surged after the company said late Wednesday it will convert its North and South American outdoor-advertising business into a real-estate investment trust and put its European and Asian businesses up for sale.

CBS Outdoor--which operates billboards and ads that appear in bus and subway stations--is one of the top outdoor-advertising companies in the world. The business accounts for about 13% of CBS's revenue but a lower portion of its profit.

Options investors began piling into bullish bets since Jan. 9, when an investor set up a big position looking for shares to rise at least 5.1% over the next month. That came ahead of more bullish bets: In the next six sessions, the number of bullish positions outstanding increased by more than 94,000 contracts, to 257,555 contracts overall. That is the highest number of bullish bets outstanding in at least six years, according to options-data firm Trade Alert.

"The trading was spread out but occurred in a few major pieces," said Henry Schwartz, president at Trade Alert. "It was so one-direction and so consistent that it is hard to believe investors hadn't been aware of the coming news."

A spokesman for CBS declined to comment. A spokeswoman for the Securities and Exchange Commission declined to comment.

The new trades in "call" options--which grant the right to buy 100 shares of stock at a set price through a designated date--are liable to reap profits that far exceed the share-price rise of 7.9% Thursday.

One investor Wednesday bought a block of 500 January $39 call options for 20 cents a share, spending $10,000 for the right to buy 50,000 CBS shares at $39 apiece. On Thursday, those options were priced as high as $3.50 a share. If the investor sold the options to close the position, he or she could walk away with $165,000 in gains--or 16.5 times the amount invested.

CBS shares finished at $37.94 Wednesday.

Meanwhile, the largest single trade over the past week could bring in nearly $6.5 million.

An investor Monday bought a block of 35,000 February $40 calls for 85 cents a share, for a total initial cost of nearly $3 million. But with a price of $2.70 recently for each contract, that investor could exit from the position with a 218% profit. Data show the investor hadn't yet closed the February $40 call position.

"This trade was not only bullish ahead of the news, but the fact that there is no sign of the trader taking profits might suggest the trader thinks there can be more upside to come," said TradeKing's Mr. Overby.

Speculation that CBS was open to a sale of the outdoor business has circulated for months. Last June, The Wall Street Journal reported bankers were gauging interest in the business after CBS Chief Executive Leslie Moonves had noted the operation wasn't a core business.

(John Jannarone contributed to this article.)

-Write to Kaitlyn Kiernan at kaitlyn.kiernan@dowjones.com

share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on CBS CORPORATION
08:48aDJCBS : Viacom, CBS Move to Explore Merger -- WSJ
09/30DJCBS : Viacom, CBS Form Special Committees to Review Possible Merger -- 2nd Updat..
09/30DJCBS : Viacom, CBS Form Special Committees to Review Possible Merger--Update
09/30DJCBS : Ad Buyers Are Bullish on Possible Viacom-CBS Reunion
09/30DJCBS : Viacom Board Naming Special Committee to Review CBS Merger
09/30DJCBS : Viacom and CBS Boards Name Special Committees to Review Merger
09/30DJCBS : Two Wary Moguls Hold Key to CBS Deal -- WSJ -2-
09/30DJLESLIE MOONVES : Two Wary Moguls Hold Key to CBS Deal -- WSJ
09/29DJCBS : Redstone's National Amusements Urges Viacom, CBS to Explore Merger -- 4th ..
09/29DJCBS : Can CBS and Viacom Merge? It Depends on the -2-
More news
Sector news : Broadcasting - NEC
09/30DJBT : Virgin Media Warn Rates Hike to Hurt Investment -- Update
09/29DJFCC Postpones Vote on TV Set-Top Box Plan -- Update
09/29DJLIBERTY MEDIA : Lehman to Pay Another $3.8 Billion to Creditors
09/28DJU.S. HOT STOCKS : Hot Stocks to Watch
09/27DJCOMCAST : Agrees to Buy Harmonic Shares in Warrant Agreement
More sector news : Broadcasting - NEC
News from SeekingAlpha
09/30 Ad buyers show enthusiasm at prospect of CBS/Viacom combo
09/30 Viacom committee examining CBS merger is heavy on new members
09/30 WSJ : CBS, Viacom setting up committees to ponder merger
09/30 WALL STREET BREAKFAST : Deutsche Bank Fears Pile Up
09/29 CBS merger talk creates big demand for Viacom bonds
Advertisement
Financials ($)
Sales 2016 14 545 M
EBIT 2016 3 186 M
Net income 2016 1 840 M
Debt 2016 8 547 M
Yield 2016 1,20%
P/E ratio 2016 13,42
P/E ratio 2017 12,46
EV / Sales 2016 2,26x
EV / Sales 2017 2,26x
Capitalization 24 362 M
More Financials
Chart CBS CORPORATION
Duration : Period :
CBS Corporation Technical Analysis Chart | CBS | US1248572026 | 4-Traders
Full-screen chart
Technical analysis trends CBS CORPORATION
Short TermMid-TermLong Term
TrendsBullishNeutralBullish
Technical analysis
Income Statement Evolution
More Financials
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 37
Average target price 62,7 $
Spread / Average Target 14%
Consensus details
EPS Revisions
More Estimates Revisions
Managers
NameTitle
Leslie Moonves Chairman & Chief Executive Officer
Joseph R. Ianniello Chief Operating Officer
Douglas Rousso Chief Technology Officer
Sumner Murray Redstone Chairman-Emeritus
Shari E. Redstone Vice Chairman
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
CBS CORPORATION16.15%24 362
COMCAST CORPORATION17.56%160 001
WALT DISNEY CO-11.63%149 235
SKY PLC-19.60%19 942
GRUPO TELEVISA SAB8.18%14 902
LIBERTY MEDIA GROUP0.00%14 407
More Results