Gap Inc (NYSE:GPS) Thursday reports earnings after the bell. Shares of Gap have lost close to 17% over the past month.
On CNBC's "Options Action," Tony Zhang said that the stock trading more than 5.4 times its average daily volume. The market is implying a move of 13.7% going into the earnings event, he added.
A trader bought 2,011 of the March 15 puts and sold 2,011 of the June 14 puts to open at a net credit of 30 cents per contract, Zhang mentioned. “This is really an extension of what is a neutral to bullish view here on Gap, he said. The trade obligates the trader to buy $2.75 million worth of Gap shares if the stock ends below $14 by the June expiration, Zhang added.
