GME ? GameStop Corp. ? Shares in video-game retailer, GameStop Corp., increased as much as 6% this morning after the company forecast fourth-quarter earnings of $2.07 to $2.27 a share and posted better-than-expected third-quarter earnings ahead of the opening bell on Thursday.
Reports the company sold more than 1 million copies of Call of Duty?: Black Ops II worldwide yesterday during a midnight launch of Activision-Blizzard, Inc.?s newest addition to their popular Call of Duty? franchise, also lifted shares in the name today. A down-day for U.S. equities took some of the wind out of GME?s sails by midday, however, with the stock currently up 2% on the session at $23.96 as of 12:35 p.m. in New York.
A number of options traders appear to be selling December expiry puts on the stock, a strategy that pays off if the price of the underlying holds onto recent gains through year end. At-the-money Dec. $24 strike puts changed hands roughly 550 times versus previously existing open interest of 327 contracts, and it appears the volume was sold for a premium of $1.33 apiece. Put sellers keep the full amount of premium as long as shares in GameStop Corp. exceed $24.00 at expiration next month.
Similarly, many of the 2,300 put options in play at the Dec. $23 strike this morning were sold by traders pocketing an average premium of $0.80 per contract. Heavier volume in excess of 5,000 puts changed hands at both the Dec. $20 and $22 strikes in the early going. Much of the volume traded to the middle of the market at premiums of $0.23 and $0.58 each, respectively.
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