Today’s tickers: DECK, LULU & PG
DECK - Deckers Outdoor Corp. – Shares in Deckers Outdoor Corp. fell as much as 12.15% to as low as $79.25 on Friday after the Company behind footwear brands UGG and Teva said 2012 earnings will be unchanged at $5.07 a share, missing average analyst expectations of $5.80 a share. Put buying in the March expiry suggests some traders are prepping for the stock to take a few more kicks to the face in the near term. Options traders appear to have purchased more than 2,150 puts at the Mar. $75 strike for a premium of $1.50 apiece. Put buyers may profit at expiration next month in the event that Deckers Outdoor’s shares shed another 7.25% to trade below the average breakeven price of $73.50. Bearish positions are also building at the Mar. $72.5 strike, where more than 1,100 puts were picked up for an average premium of $1.00 a-pop. Front month put positioning contrasts with April expiry activity in far out-of-the-money put options. It looks like strategists betting the stock is unlikely to crash much lower ahead of April expiration sold around 6,000 puts at the $70 strike at a premium of $1.51 each, and sold another 1,900 puts at the lower $65 strike for an average premium of $0.76 apiece. Put sellers walk away with the full amount of premium received on the trades as long as DECK’s shares keep their footing above the strike prices described at April expiration.
LULU - Lululemon Athletica, Inc. – Traders appear to be bulking up on bullish Lululemon options today, with shares in the retailer of high-end athletic apparel earlier rallying to a record high of $67.57. Call buying in the March expiry this morning may be the work of strategists preparing for…
