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Groupon Inc (NASDAQ:GRPN) is 1.3% lower this afternoon at $7.35, bringing its year-to-date loss to roughly 37.6%. Nevertheless, in the daily deals website's options pits, call volume is running at a more than two-fold mark-up to the average intraday rate. By the numbers, 23,000 calls are on the tape compared to fewer than 7,500 puts.
Most active is GRPN's May 10 call, where almost 8,000 contracts have changed hands. Nearly all have traded at the ask price, and implied volatility is 5.2 percentage points higher, suggesting buy-to-open activity. That said, the traders are either banking on the shares returning to double-digit territory, or are protecting their short stock positions against a rally of that sort. After all, short interest increased 81.6% during the last two reporting periods, and currently comprises 16% of GRPN's float.
Historically, Groupon Inc (NASDAQ:GRPN) shares haven't traded north of $10 since gapping lower following their Feb. 20 earnings report. The company again steps up to the earnings mic on Tuesday, May 6, and the Street expects a per-share loss of 3 cents, compared to GRPN's 3-cent profit one year ago.