Option Skews – Relatively Heavy Call Activity on 3PAR Inc., Bank Of America Corp., Genzyme Corp., and Vale S.A.

3PAR Inc. (PAR), Bank Of America Corp. (BAC), Genzyme Corp. (GENZ), and Vale S.A. (VALE), were among those stocks seeing a skew toward call buying on Friday.

Hewlett-Packard Co. (HPQ) escalated the bidding war for 3PAR Inc. (PAR) to $30 per share yesterday morning, putting the ball back in rival Dell Inc.'s (DELL) court. However, if this morning's speculation is to be believed, Dell is likely to bow out of the contest. "I think it's hard to compete with HP," Peter Bell, of Highland Capital Partners, told Reuters, "They've got the bigger balance sheet."

Still, the possibility that tennis match could come to and end didn't stop options players from snatching up more PAR calls on Monday. More than 5,000 of these bullish bets were bought to open, compared to about 1,633 puts purchased on the International Securities Exchange (ISE). During the prior two weeks, the buy-to-open ISE call/put volume ratio for PAR has risen to 2.07, as calls purchased have more than doubled puts purchased. With the bidding war soon to be over, and PAR trading near $31.82, nearly two points above HPQ's current bid, we should see PAR come back to earth a bit.

Meanwhile, Genzyme Corp. (GENZ) was also the center of merger and acquisition news, with the company officially rejecting a $18.5-billion buyout bid from French counterpart Sanofi-Aventis (SNY). GENZ was targeted by 3,338 bought-to-open calls on the ISE on Monday, compared to only about 600 purchased puts.

Finally, Vale S.A. (VALE) saw most of yesterday's option volume trade in a series unusual long positions, including a split-strike synthetic long.

This filtered scan is based on the International Securities Exchange (ISE) buy-to-open data. It looks for stocks where the previous day's call volume on the ISE is at least twice as great as the put volume. It then sorts the stocks based on the call volume. Since this is buy-to-open data, this can be a good source for finding stocks where optimism is emerging. Of particular interest to me would be situations where we see call activity on stocks that are still in intermediate-term downtrends. This would be a potentially cautionary sign from the contrarian perspective

Other companies seeing a skew towards calls in the previous session: Delta Air Lines Inc. (DAL), Intel Corp. (INTC), Hewlett Packard Co. (HPQ), Potash Corp. of Sask. Inc. (POT), Baker Hughes Inc. (BHI), Cisco Systems Inc. (CSCO), Goldman Sachs Group Inc. (GS), Brocade Comm. Systems (BRCD), Hartford Financial Services (HIG), AK Steel Holding Corp. (AKS), Electronic Arts Inc. (ERTS), Jetblue Airways Corp. (JBLU), Pfizer Inc. (PFE), Petrohawk Energy Corp. (HK), EMC Corp. (EMC), Arena Pharmaceuticals Inc. (ARNA), AMR Corp. (AMR), Lululemon Athletica Inc. (LULU), Directv (DTV), Ford Motor Company (F), Suntrust Banks Inc. (STI).