Option Trades Suggest Green Mountain (GMCR) Will Get Slammed on Q3 Numbers
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Green Mountain Coffee Roasters (Nasdaq: GMCR) is expected to report third-quarter earnings in two weeks and some are betting on a big drop in the shares.
According to data compiled by the WSJ, one trader sold 3,000 July 17 puts while selling the same amount of August 15 puts, a strategy known as the diagonal spread. Total outlay on the position is $225,000. Profit will start to be made when Green Mountain starts slumping below $14.25, a level shares haven't seen in over three years.
Another trader took a bearish bet, but a little further out. The trader bought 200 December 19 puts while selling an equal amount of December 19 calls. He'll begin to profit when shares fall below $18.05.
Set for August 1, Green Mountain is expected to produce EPS of 50 cents and revs of $873.8 million. Those following the stock remember the massive 48 percent plunge Green Mountain had with its last quarterly report.
Shares are down about 0.2 percent in late trading Tuesday.
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According to data compiled by the WSJ, one trader sold 3,000 July 17 puts while selling the same amount of August 15 puts, a strategy known as the diagonal spread. Total outlay on the position is $225,000. Profit will start to be made when Green Mountain starts slumping below $14.25, a level shares haven't seen in over three years.
Another trader took a bearish bet, but a little further out. The trader bought 200 December 19 puts while selling an equal amount of December 19 calls. He'll begin to profit when shares fall below $18.05.
Set for August 1, Green Mountain is expected to produce EPS of 50 cents and revs of $873.8 million. Those following the stock remember the massive 48 percent plunge Green Mountain had with its last quarterly report.
Shares are down about 0.2 percent in late trading Tuesday.
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