Bears count on NuVasive to drop-11/27/2009

Medical-device maker NuVasive has been falling on concerns about insurance reimbursements, and now the bears are looking for a push lower.

optionMONSTER's Depth Charge tracking system detected unusual buying of the December 30 puts, which traded 2,338 times against open interest of 1,097 contracts. Most of the large transactions priced for $0.65 to $0.85.

NUVA rose 4.58 percent to $34.73 on Wednesday but is down 12 percent in the past month. Investors have been worried about a report that a key procedure linked to the company's products may not be covered by large insurers including Aetna and Cigna.

Management plans to hold a conference call after the bell on Monday to discuss the concerns. It is also scheduled to participate in the Piper Jaffray Healthcare Conference on Dec. 2 and the JP Morgan SMid Cap Conference on Dec. 3.

NUVA needs to fall about 16 percent by expiration for the puts bought on Wednesday to turn a profit. The recent bearishness comes despite management raising full-year guidance on Oct. 20.

Overall options volume in the name was five times greater than average last session, with puts accounting for 87 percent of the activity.

(Chart courtesy of tradeMONSTER)

See all articles in the option trading area