Herbalife Ltd. (HLF) Bear Places Huge Eleventh-Hour Bet

One put buyer needs Herbalife Ltd. (HLF) to take a turn for the worse by tomorrow's close

Digital Content Group
Apr 16, 2015 at 2:23 PM
facebook X logo linkedin


Even though Herbalife Ltd. (NYSE:HLF) is 1.2% higher today at $44.81, puts are dominating its options pits. The contracts are crossing at 1.6 times the average intraday rate, mostly due to one trader's ambitious bet. Specifically, someone bought to open 7,000 April 45 puts for $1.09 apiece. Doing the math, this means the trader spent $763,000 (number of contracts * premium paid * 100 shares per contract) to bet on the shares falling further below $45 by tomorrow's close, when the contracts expire.

Seeing traders so focused on puts is uncommon in HLF's options pits. In fact, the equity's Schaeffer's put/call open interest ratio (SOIR) comes in at 1.01, and ranks in the 6th annual percentile. This means HLF's short-term options traders are far more call-skewed than usual.

Elsewhere, analysts are split on the stock, issuing two "strong buy" ratings, versus two "holds." Also worth noting is HLF's short interest, which accounts for over 36% of its float. It would take these bearish traders eight sessions to buy back their bets, at normal daily volumes.

Looking at the charts shows Herbalife Ltd. (NYSE:HLF) has performed well in 2015. The shares have added 18.9% year-to-date, and in the past three months, have outpaced the S&P 500 Index (SPX) by 43 percentage points. What's more, HLF is on pace to notch a second consecutive close north of its 200-day moving average -- a feat not accomplished since last July.

HLF put/call open interest
 

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