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.
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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