Examining Carl Icahn's portfolio: Hilton Hotels

Hilton Hotels Corp. (NYSE: HLT) opened at $33.75. So far today the stock has hit a low of $33.44 and a high of $33.80. As of 11:45 this morning, HLT is trading at $33.62, down $0.28 (-0.8%).

After hitting a one year high of $38.00 in April, the stock has dipped slightly, bouncing off support a few times just below $34. Billionaire investor Carl Icahn dumped all of his HLT shares in the first quarter of this year, indicating sentiment that HLT is unlikely to rise above its previous high. In fact, the stock is breaking below its support line today, which is not a good sign. Recent technical indicators for HLT have been bearish and steady, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.

For a bearish hedged play on this stock, I would consider an October bear-call credit spread above the $40 range. HLT has never been above $40 and has shown resistance around $36 recently. This trade could be risky if the company's earnings (due out on July 31) impress, but even if that happens, HLT would have to break through the three tops it has already formed this year between $36 and $38 before this position would be in trouble.

Brent Archer is an options analyst and writer at Investors Observer. DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls a position in HLT.