Vistaprint (VPRT - option chain) shares are rising today after the company announced this morning despite terminating a membership program that it still expects Q2 adjusted EPS of 55 to 60 cents on revenue of $167 to $175 million, roughly in line with analysts' forecasts of 59 cents and $175.05 million, respectively. 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 VPRT.VPRT opened this morning at $55.15. So far today the stock has hit a low of $54.87 and a high of $56.00. As of 11:55, VPRT is trading at $55.88 up $2.78 (5.2%). The chart for VPRT looks neutral and S&P gives VPRT a neutral 3 STARS (out of 5) hold ranking.
For a bullish hedged play on this stock, I would consider a January bull-put credit spread below the $45 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 a 5.3% return in seven weeks as long as VPRT is above $45 at January expiration. Vistaprint would have to fall by more than 19% before we would start to lose money. Learn more about this type of trade here.
VPRT has not been below $45 since September and has shown support around $50 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 VPRT.
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