Q2 STOCKS TO BUY

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
 
 

“Buy This Stock Now!” - Expert Who Called 11x On TSLA

He called a rare 11x on Tesla…

But now, thanks to Elon & Trump’s new alliance…

He says there’s a new opportunity that could be 1,000x BIGGER than Tesla – and it could completely revolutionize a $23 Trillion market.

It’s trading for less than $5 per share right now…

But it won’t be under the radar for long.

Discover The 1,000x Bigger Elon Opportunity Here

GRAND SLAM COUNTDOWN

 
 

Featured Articles from Trusted Partners:

👀Learn How Dividends Create Passive Income for Life
Receive $200 Off Motley Fool Epic. The Motley Fool Epic $299 discounted offer is based on $499/year list price. Introductory promotion for new members only. Take control of your money and your portfolio with Motley Fool Epic.

💵New Income System Could Pay You $4,243 Monthly
You could collect an average of $4,243 per month starting as early as next week with a new payout system for income investors. New registrations are being accepted for investors who want to be in a position to start with their first payout next week.

🚀Easy 92% Crypto Dividends (No Coins Required)
COIN stock doesn't pay a dividend... But there's actually a new way to collect a massive dividend that's indirectly based on the stock and offers a terrific monthly income (currently yielding nearly 92% on a forward basis).

🤝Free Advisor Match with Wiseradvisor.com
Don't leave your retirement to chance! Get matched with a trusted financial expert for FREE and make the most of your tax refund. Get started now.

⚠️Dennis Quaid's #1 Warning for Americans
Here's the thing: life doesn't come with guarantees. The economy shifts, markets stumble, and years of hard work could slip through your fingers like sand. But it doesn't have to be that way for you. So request a free copy of this Gold & Silver Guide that will arrive right to your doorstep when you act now.

 

 
 

Follow us on X, Follow us on Twitter