PSS World Medical (PSSI): Stealth Options Action of the Day

PSS World Medical (PSSI) traded 50X daily call volume as 1,000 June $30 calls were bought on the CBOE at $0.625, with the bid-ask at $0.55/$0.80, so not an aggressive purchase, but appears to have been a buyer based on the IV movement. Earnings are May 12th before the open and shares are at all time highs, and have jumped on earnings the last 2 quarters. The $1.6B Medical Equipment Co. trades 19.5X earnings, 0.8X sales, and 17.5X cash flow. There is a 14.95% short float, 16.35 days to cover, so a short squeeze is a real possibility. If earnings turn out not to be the catalyst there is also the Jefferies, Goldman and William Blair Conferences in June where the Company will be presenting. Last quarter the Company guided FY11 above the Street. PSS World Medical is a supplier that is a direct play on the aging baby boomers as it supplies to alternate site physician practices and elder care businesses. Credit Suisse has an Outperform rating on shares.