Put buying targets Jive before earnings

Mike Yamamoto (mike.yamamoto@optionmonster.com)

Jive Software is drawing bearish option activity ahead of its earnings report next week.

More than 2,600 May 12.50 puts traded in a strong buying pattern yesterday as premiums rose from $0.35 to $0.55, according to optionMONSTER's Depth Charge tracking system. These are new positions, as the volume was more than 12 times the strike's open interest of just 207 contracts before the session began.

JIVE was up a penny yesterday to close at $13.87. The stock rose from below $14 to above $17 between early February and early March, but it has given up all those gains and is now trying to hold support at current levels.

Yesterday's puts were not tied to any stock trading identified by our systems in the session but could be a protective hedge on a long position established earlier. These options could also be making a straight bearish bet on JIVE, as they lock in a $12.50 sale price for the stock no matter how far it might fall, but they will expire worthless if shares remain above that level for the next three weeks. (See our Education section)

Total option volume in the name was quadruple its daily average for the last month. Puts outnumbered calls by nearly 2.5 to 1.

The software company offers products that combine social media with business applications. It is scheduled to release first-quarter results on Tuesday after the market closes and will hold its analyst and investor day on May 21 .


More From optionMONSTER