Processed foods company Conagra Brands (CAG) is down 7% over the past year, with shares recently breaking to a new 52-week low in 2025. One trader sees a rebound in the months ahead.
That’s based on the June 20 $27 calls. With 156 days until expiration, 7,570 contracts traded compared to a prior open interest of 119, for a 64-fold rise in volume on the trade. The buyer of the calls paid $0.90 to make the bullish bet.
Following its recent selloff, Conagra trades at about $26, so shares would need to rally by $1, or just under 4%, for the option to move in-the-money.
The strike price of the option is well off the stock’s 52-week high of $33.24.
Conagra shares look weak in the short-term, having broken to new lows. But shares are also looking oversold in terms of relative strength, indicating a potential bounce higher could occur in the weeks ahead.
Action to take: Investors may want to hold off for now, given the technical weakness in shares.
The drop in share price has pushed the stock’s dividend to 5.1%, however, Conagra currently pays more than 100% of its earnings as a dividend.
For traders, the June $27 calls could rally in the months ahead. Traders may be able to build a stake over the coming days at a lower price to get in on a bounce higher.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.