Kraft Foods Inc. (NYSE: KFT) stock is falling this morning after the company announced its fourth-quarter profit fell to $585 million, or 38 cents a share, from $624 million a year earlier. Earnings excluding restructuring costs matched analysts' estimates of 44 cents a share, but KFT's revenue was hurt by higher costs for dairy products and other ingredients, which offset an 11% increase in sales. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on KFT.

After hitting a one-year high of $37.20 in June, the stock hit a one-year low of $28.63 last week. This morning, KFT opened at $29.75. So far today the stock has hit a low of $29.51 and a high of $29.95. As of 10:50, KFT is trading at $29.90, down $0.29 (-1.0%). The chart for KFT looks bearish and steady, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bearish hedged play on this stock, I would consider a June bear-call credit spread above the $35 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.7% return in 5 months as long as KFT is below $35 at June expiration. Kraft would have to rise by more than 17% before we would start to lose money.

KFT hasn't been above $35 by more than a few cents since July and has shown resistance around $31.50 recently. This trade could be risky if the companies earnings from this morning turn out to be better than they looked at first glance, but even if that happens, this position could be protected by resistance KFT might from its 200 day moving average, which is currently around $33.

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 positions in KFT.