All things being equal and XYZ meets or exceeds their guidance I think a large call option purchase before the 10-K release is uniquely positioned to do well in this situation for several reasons. The company's revenue model is odd, they basically make half of their revenue in Q4 (confirmed by old 10-Ks), I think this artificially depresses their price until their Q4/10-K is released. They haven't posted their Q3 yet, but I doubt it will affect the stock price all that much ($25). I also think their price is depressed because if they truly deliver on their guidance this year it will be the first time they posted profit margins on significant revenue that is in line with the rest of their industry (in fact their guidance seems to beat the average profit margins of their industry). They have a P/E ratio of 6.25 right now (based off last years revenue), based on their guidance for next year they have a P/E ratio of 5.66. No competitor has a P/E ratio this low, the next lowest competitor has a P/E ratio of 14 (based on way more revenue). Their most comparable competitor (ABC again) has a P/E ratio of ~25; this competitor has posted about 4 times the revenue, but only twice the profit that XYZs guidance would deliver. I think that after Q4/10-K earnings the stock will correct to a higher P/E ratio.

I really want to purchase some call options after Q3 earnings (if the price continues to hover around ~25).