Pre-Earnings Bull Places Big Bet on Groupon, Inc. (GRPN)

One speculator expects Groupon Inc (GRPN) to topple $8 by tomorrow's close

Digital Content Group
Feb 12, 2015 at 1:56 PM
facebook X logo linkedin


Groupon Inc (NASDAQ:GRPN) is 1.2% higher this afternoon to trade at $7.67, ahead of tonight's highly anticipated earnings report. Options volume has spiked to seven times the amount typically seen at this point in the day, with the weekly 2/13 series garnering plenty of attention.

Digging deeper, Trade-Alert identifies one trader who's using options to wager on additional upside through tomorrow's close, when the series expires. Specifically, this speculator bought to open 8,000 weekly 2/13 8-strike calls, and simultaneously sold to open 12,000 weekly 2/13 9-strike calls, initiating a bullishly skewed ratio spread. Additionally, to help offset the cost of the 8-strike calls, the trader sold to open a total of 4,000 contracts at the weekly 6.50- and 7-strike puts.

This is a bold bet, given not only its size, but also GRPN's propensity to make big moves after earnings. Following the last eight quarterly reports, the stock has averaged a 17.6% single-session move, with three of the last four to the downside.

Ahead of tonight's event, options traders have generally been bearish toward Groupon Inc (NASDAQ:GRPN). The stock's 10-day put/call volume ratio across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) is 0.41, in the 88th percentile of its annual range. Elsewhere, 19% of GRPN's float is sold short, which would take roughly seven sessions to cover, at typical daily trading levels.

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI