Bristol-Myers Squibb (NYSE: BMY) shares are trading higher today after a Bernstein analyst wrote that BMY might be a takeover candidate, one day after the company announced it has completed its $234.6 million acquisition of Kosan Biosciences. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on BMY.

After hitting a one-year high of $32.35 in July, the stock hit a one-year low of $19.43 last week. BMY opened this morning at $20.06. So far today the stock has hit a low of $20.00 and a high of $20.60. As of 12:50, BMY is trading at $20.45, up 78 cents (4.0%). The chart for BMY looks bearish and steady, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.

For a bullish hedged play on this stock, I would consider a September bull-put credit spread below the $17.50 range. A bull-put credit spread is an options position that combines the purchase and sale of put 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 11.1% return in just three months as long as BMY is above $17.50 at September expiration. BMY would have to fall by more than 14% before we would start to lose money. Learn more about this type of trade here.

BMY hasn't been below $19.40 at all in the past year and has shown support around $19.50 recently. This trade could be risky if the company's earnings (due out on 7/24) disappoint, but even if that happens, this position could be protected by the support the stock might find from bargain hunters looking for defensive stocks.

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 BMY.