Options Brief: NetApp (NTAP)

NTAP – NetApp, Inc. – Shares of the supplier of enterprise storage and data management software, as well as hardware products and services, are soaring 17.55% higher this morning at a new 52-week high of $38.12 as of 11:00 am (ET). NetApp’s shares jumped after the firm posted fourth-quarter adjusted earnings of $0.50 a share, which blew right past average analyst forecasts of $0.43 a share. Investors looking to lock in the sharp rally in the price of the underlying shares purchased approximately 3,800 July $37 strike puts at an average premium of $2.13 per contract. The put options provide downside protection in case shares reverse direction ahead of July expiration. Downside protection in this case kicks in if NetApp’s shares fall 8.525% from the current price of $38.12 to breach the average breakeven point on the puts at $34.87 by expiration day.

About Andrew Wilkinson 1023 Articles

Affiliation: Interactive Brokers

Andrew Wilkinson is the senior market analyst at Interactive Brokers Group, where he provides daily commentary and analysis on U.S. equity options trading throughout the trading day. Andrew provides webinars designed to explain option-related trading scenarios covering futures, fixed income, forex and equities.

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