The bears targeted big media yesterday, snapping up puts in a
content company, a broadcaster and a newspaper publisher.
optionMONSTER's Depth Charge tracking system detected a late-day
surge of put buying in Viacom, CBS, and Gannett that drove total
options activity to more than 15 times the average level in each.
The trades came amid heavy stock volume in the names as well.
The VIA.B August 25 puts were the busiest strike, with a single
block of 20,247 purchased for $0.40 against open interest of just
11 contracts. The shares fell 1.94 percent to $30.76 yesterday and
would need to decline further, near their September lows, for the
puts to turn a profit.
At about the same time, 15,495 August 11 puts were bought in GCI
for $0.50. The newspaper chain, which owns USA Today, fell 0.74
percent to $13.36 yesterday and is down 19 percent in the last two
In CBS, put buyers targeted the August 10 contracts, which saw
volume of 14,296 against no existing pen interest. The operator of
radio and television channels declined 0.62 percent to $12.85
yesterday. The puts, which priced for $0.30, and won't make any
money unless CBS falls at least 25 percent by expiration.
The three companies reported improvements in business conditions
during their last earnings reports. However, each is now trading
below its 50-day moving average and showing signs of rolling
Given the timing of the trades, yesterday's put activity was
probably the work of a single large investor positioning for the
three companies to break down to significantly lower lows. This
trader may expect management teams to issue bearish comments this
earnings season, hampered by signs that the global economy is
The next scheduled events that could serve as potential
catalysts for the stocks include GCI's earnings release on July 16
and CBS's announcement on August 3. Both will come out after the
(Chart courtesy of
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