Trader Bets Big That Whole Foods Will Dive And Wins

Whole Foods Market, Inc. (NYSE: WFMI) dives after reporting disappointing guidance in the after-hours trading session. Whole Foods sees FY10 EPS $1.05 to $1.10 vs consensus of $1.11.

Yesterday, there was a big put buyer in Whole Foods of the November 31 puts for $1.60, and the sale of November 27 puts for 42 cents and November 37 calls for 40 cents. The trade was executed on 7,836 contracts of each strike and cost a net 78 cents. Volume was above open interest.

Whole Foods closed above $32 today and is now trading down 9% to $29.12.

The above option trade makes money if Whole Foods closes below $30.22 on expiration and loses money over $37. With Whole Foods reporting dreadful earnings this evening, this option trader has hit the jackpot.