Unusual Activity Seen In Coach

Accessories retailer Coach Inc COH has had a terrible 2014; The company’s stock is down around 40 percent year-to-date. However, the stock witnessed a sudden upsurge on Thursday and closed the day 2.5 percent higher at $34.46.

Joe Najarian deciphered the unusual activity in the stock and Stephanie Link Brown provided her perspective on it on CNBC.

"We had some very strong activity in Coach today […] now it hit right away, we bought it right away. Stock popped up over $35, many of you remember that this stock was $55 or $60 stock or $56 stock earlier in the year and has sold off rather dramatically. So people are willing to bet that rumors like Prime Retailers, I think, or some such site had a rumor that LVMH was taking a look at these guys and so forth," Najarian said.

"Whoever it is that may be kicking the tires here, normal volume is about 3,000 options a day. It has already traded over 17,000 (these are just on the call side). So somebody thinks they have got tomorrow’s newspaper today in this name as well."

Link was a little skeptical on the activity, saying, "It could very well be as simple as this that Lulu just blew it away relative to low expectations and Coach hasn’t been able to deliver in forever and so maybe, just maybe, they can deliver in this kind of environment, maybe expectations are lower. Maybe it’s not activism at all, although if any company in that particular sector is going to see activism, that is the one."