Unusual Options Activity: Bullish Traders on Block Could Explore These 2 Strategies

Core Insights - Block's stock has lukewarm analyst support with 27 out of 41 analysts rating it as a Buy, and a target price of $84.58, which is about 5% above its current price [1] - The company's share price has fluctuated between $50 and $100 from May 2022 to October 2025, reaching a 52-week high of $99.26 on December 5, 2024, but has since declined by 19% [2] - Block's Q2 2025 results were weaker than expected, but the guidance for 2025 has left investors optimistic, leading to a modest increase in share price over the following months [6][7] Financial Performance - For 2025, Block projects a gross profit of $10.17 billion and an adjusted operating profit of $2.03 billion, reflecting a 20% margin, significantly higher than the 2024 figures of $8.89 billion gross profit and $892 million operating profit with a 10% margin [7] - Cash App's gross profit increased by 16% year-over-year, indicating positive growth in the company's financial ecosystem integration efforts [9] Strategic Focus - Block is concentrating on the restaurant and hospitality sectors, recently launching new products aimed at enhancing the operational efficiency of restaurant owners [8] - The long-term goal is to merge Cash App and Square into a single integrated financial platform, which is expected to simplify user experience and increase engagement [9] Options Activity - There was significant options activity for Block, with 1,311 unusually active options recorded, where calls outnumbered puts more than two to one [4] - The Nov. 21 $75 and $65 puts had the highest volumes, indicating potential strategies for investors looking to capitalize on Block's stock movements [3][11] Options Strategies - The Long Ratio Call Spread strategy involves a combination of short and long calls, betting on significant price movement, with maximum gain being unlimited based on stock appreciation [21][22] - The Covered Strangle strategy includes owning shares while selling out-of-the-money puts and calls, providing premium income and potential high returns based on various scenarios [12][18][19]