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Put trading has picked up on Microsoft Corporation (NASDAQ:MSFT) today, with roughly 51,000 of them changing hands -- a 19% bump over typical intraday trading volume. Puts are also outstripping calls by a margin of about 10,000 contracts.
The day's most popular option is the June 30 put, where 17,047 contracts have traded at a volume-weighted average price (VWAP) of $0.10 -- mostly on the ask side, indicating they were bought. More specifically, a corresponding 2.7 percentage point uptick in implied volatility suggests they were bought to open. Thus, these bearish bettors stand to gain should shares of Microsoft dive to $29.90 (strike less VWAP) from their current price of $34.21, by June expiration.
Today's put-heavy activity falls right in line with the prevailing sentiment in MSFT's options pits. The stock's 50-day put/call volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) is 0.72, which ranks in the 98th percentile of readings taken over the past 52 weeks. In other words, put-buying activity is approaching its annual peak.
Opinions within the brokerage bunch are considerably more varied. Of the 29 analysts assessing Microsoft, 16 reward it with ratings of "buy" or better, while 13 give it a tepid "hold."
Technically, MSFT has struggled since touching a high of $35.27 earlier this week, shedding 3%.