Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Bearish options on Vail Resorts pay off for some traders as shares slide

Page 1 of 2

Bearish options on Vail Resorts pay off for some traders as shares slideVail Resorts, Inc. (NYSE:MTN) – Shares in ski resort operator, Vail Resorts, Inc. (NYSE:MTN), dropped sharply on Tuesday after the company posted a larger-than-expected first-quarter loss and warned it may miss its projected earnings target for the year. The stock currently trades down 9.2% on the day at $50.70 as of 11:00 a.m. in New York, the lowest level since August. Rising open interest levels and a review of time and sales data for transactions in Vail Resorts, Inc. (NYSE:MTN) front-month put options on Monday indicates some strategists were anticipating the stock may pullback after earnings. Bearish players appear to have purchased around 200 puts at the Dec. $52.5 strike for an average premium of $0.65 each and more than 350 put options at the Dec. $55 strike at an average premium of $1.48 apiece. Traders prepared for Vail Resorts, Inc. (NYSE:MTN) to hit an icy patch find the value of their contracts have more than tripled overnight, with premium on the $52.5 and $55 strike contracts rising to $2.50 and $4.60 apiece, respectively, as of 11:15 a.m. ET on Tuesday morning. Finally, traders also appear to be selling upside calls on Vail, with around 225 of the Dec. $57.5 strike calls hitting the bid price of $0.05 in the early going.

Tripadvisor Inc (NASDAQ:TRIP) – Shares in online travel company, Tripadvisor Inc (NASDAQ:TRIP), are on the decline today, trading down 3.75% at $36.28 as of 11:30 a.m. ET. Upside call buying on the stock, however, suggests some strategists are positioning for the price of the underlying to rebound ahead of December expiration. Options volume on Tripadvisor Inc (NASDAQ:TRIP) today is greatest in the front month calls, with heavy trading traffic in the $38 and $39 strike contracts. Traders exchanged some 1,400 call options at the Dec. $38 strike and another 1,100 lots at the higher Dec. $39 strike. It looks like most of these calls were purchased earlier in the trading session at average premiums of $0.65 and $0.40 apiece, respectively. Traders long the $38 strike calls stand ready to profit at expiration in the event that TRIP’s shares rally at least 6.5% over the current price of $36.28 to surpass the average breakeven point at $38.65, while buyers of the $39 strike calls require a minimum 8.6% upside move in the stock price in order to breakeven at $39.40 by December expiration. Tripadvisor Inc (NASDAQ:TRIP) shares are down more than 30% off a 52-week high of $47.81, but are up nearly 40% since the start of 2012. Options volume in excess of 4,800 contracts before midday on Tripadvisor Inc (NASDAQ:TRIP) is noteworthy given the stock’s average daily options volume of around 1,860 contracts.

Page 1 of 2

Biotech Insider Alert - $5 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!