Gap Inc (NYSE:GPS) reports earnings Thursday after the bell. Shares of Gap rose 5.43% to close Wednesday’s trading at $14.57.
On CNBC's "Options Action," Tony Zhang said the stock traded more than 4.5 times its average daily volumes on Wednesday.
“The options market is implying a huge move of 13.7% going into this earnings event,” Zhang mentioned.
See Also: Earnings Preview For Gap
There was a buyer of 2,011 of the March 15 puts, selling the same number of contracts of the June 14 puts for a net credit of 30 cents per contract, he added.
“This is really an extension of what is a neutral to bullish view here on Gap and obligating them to purchase $2.75 million worth of Gap shares if the stock is below $14 by that June expiration,” Zhang said.
