McCormick (NYSE: MKC - option chain) shares are pretty much flat today after the company reported Q3 earnings that came in at 0.50, 2 cents higher than analyst estimates. Sales beat estimates as well, but the stock is not really moving since some of the EPS benefits were from the sale of one of their brands. Last night, CNBC analyst and BloggingStocks contributor Jim Cramer also mentioned this stock as a potential buy on his TV show if it gets depressed by losses in the broader market. 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 MKC.

MKC opened this morning at $39.63. So far today the stock has hit a low of $38.16 and a high of $39.64. As of 12:10, MKC is trading at $38.71, up 21 cents(0.5%). The chart for MKC looks neutral and S&P gives MKC a 3 STARS (out of 5) hold ranking.

For a bullish hedged play on this stock, I would consider a December covered call at the $40 level. A covered call is an options position that combines the purchase of stock with the 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 6.0% return in just 3 months if MCK is above $40 at December expiration. If it is below $40, then we picked up a free $1.10 per share by selling the call. Plus, MKC pays a small dividend that we will receive if we hold the stock on 10/01. McCormick would have to fall by more than 3% before we would start to lose money. Learn more about this type of trade here.

MKC hasn't been below $37.75 (our break-even point) since July and has shown support around $38 recently.

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 MKC.