PACCAR Inc (PCAR) is a company that manufactures medium and heavy duty trucks under several different nameplates. The company’s stock is currently trading around $65.95 in a 52 week range of $47.12-$66.46. The stock has been outperforming the market this year with shares gaining over 11% year to date. Options activity during today’s session would suggest that traders believe this trend will continue through May expiration. Earlier in the session a trader bought 5,000 PCAR May 66.60 calls for $2.05 to $2.10. This is a very bullish trade that requires this trader to invest around $1 million in premium. PCAR is also trading above the Ichimoku Cloud, suggesting the stock has more room to the upside. With order flow this strong and a bullish chart set up we believe PCAR is setting up well for a long.
Trade Setup: Buying the PCAR May 66.6 Calls for $2.10
Risk: $210 per 1 lot
Reward: Unlimited
Breakeven: $68.70