Fossil Inc. (NASDAQ: FOSL) shares are falling today after the company forecast a second-quarter adjusted profit of 29 cents per share, just below analysts' estimates of 30 cents per share. FOSL also forecast sales between $341.1 and $347.5 million, missing analysts' estimates of $352.4 million. 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 FOSL.

After hitting a one-year low of $24.81 in August, the stock hit a one-year high of $46.25 in December. This morning, FOSL opened at $34.46. So far today the stock has hit a low of $33.33 and a high of $35.65. As of 1:15, FOSL is trading at $33.98, down $3.27 (-8.8%). The chart for FOSL looks bullish and deteriorating slightly, while S&P gives the stock a bullish 4 Stars (out of 5) Buy rating.

For a bearish hedged play on this stock, I would consider a September bear-call credit spread above the $45 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 a 6.4% return in four and a half months as long as FOSL is below $45 at September expiration. Fossil would have to rise by more than 33% before we would start to lose money. Learn more about this type of trade here.

FOSL hasn't been above $45 since December and has shown resistance around $38 recently. This trade could be risky if the US economy turns around quickly, but even if that happens, this position could be protected by resistance FOSL might find from its 200-day moving average, which is currently around $35.

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 FOSL.