Carnival Options Traders See Upside As Cruise Line Returns To The Seas

Carnival Corporation CCL announced Wednesday that it plans to resume sailing around the Canary Islands this winter.

Earlier in the week, Carnival said its brands would resume  Caribbean and European schedules this summer. 

Carnival’s stock is down about 46% from its pre-COVID-19-pandemic high of $51.94, but is up just under 250% from the $7.80 low made on April 2, 2020.

Carnival options traders believe the company’s return to the seas will bring its stock more upside in the weeks ahead and are betting on continued momentum.

See Also: How to Buy Carnival Stock

The Carnival Corporation Option Trades: Below is a look at the notable options alerts courtesy of Benzinga Pro:

• At 10:03 a.m. Wednesday a trader executed a call sweep above the ask of 210 Carnival Corporation options with a strike price of $30 expiring on July 16. The trade represented a $30,240 bullish bet for which the trader paid $1.44 per option contract.
• At 10:17 a.m., a trader executed a call sweep above the ask of 665 Carnival Corporation options with a strike price of $27 expiring on June 4. The trade represented a $91,770 bullish bet for which the trader paid $1.38 per option contract.
• At 10:25 a.m., a trader executed a call sweep at the ask of 358 Carnival Corporation options with a strike price of $30 expiring on June 18. The trade represented a $31,504 bullish bet for which the trader paid 88 cents per option contract.
• At 12:05 p.m., a trader executed a call sweep at the ask of 250 Carnival Corporation options with a strike price of $35 expiring on Oct. 15. The trade represented a $41,250 bullish bet for which the trader paid $1.65 per option contract.
• At 12:54 p.m., a trader executed a call sweep near the ask of 505 Carnival Corporation options with a strike price of $27 expiring on June 4. The trade represented a $83,830 bullish bet for which the trader paid $1.66 per option contract.

Why It’s Important: When a sweep order occurs, it indicates the trader wanted to get into a position quickly and is anticipating an imminent large move in stock price.

A sweeper pays market price for the call option instead of placing a bid, which sweeps the order book of multiple exchanges to fill the order immediately.

These types of call option orders are usually made by institutions, and retail investors can find watching for sweepers useful because it indicates “smart money” has entered into a position.

CCL Price Action: Shares of Carnival Corporation lost 1.18% Wednesday, closing at $27.68.