RR Donnelley & Sons reports earnings this week, and traders are divided on the outcome.
optionMONSTER's tracking systems detected a neutral trade late yesterday morning, followed by downside activity later in the session. Second-quarter results are due from the printing company tomorrow morning.
In the first transaction, roughly 1,500 contracts were sold in each the September 18 puts for $0.70 to $0.75 and the September 19 calls for $0.40 to $0.50. Known as a short straddle, the trader will get to keep the money if RRD stays between the two strikes through expiration.
RRD fell 1.38 percent to $18.55 yesterday and is attempting to hold a level that was resistance before April and since then has provided support. Its last earnings report on May 4 missed analyst estimates.
The second set of trades occurred in the September 19 puts and the August 18s, which mostly fetched $1.25 and $0.50, respectively. Volume was above open interest in both strikes. Those transactions reflect a decisively bearish outlook for the stock.
Overall option volume in RRD was 15 times greater than average in the session, with puts outnumbering calls by 4 to 1.
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