Mike Khouw Sees Unusual Options Activity In Starbucks

On CNBC's "Options Action," Mike Khouw said Starbucks Corporation SBUX traded more than three times its average daily call volume on Tuesday.

One of the most active options he saw were the July $120 calls that expire at the end of this week. Over 20,500 contracts were traded for just over 60 cents, said Khouw. Buyers are betting the strength we saw on Tuesday could continue through the end of the week.

The company reports earnings on July 27 and Goldman Sachs recommended call buying in Starbucks, said Khouw. He saw some activity in the August $120 calls as well.