Unusual Options Activity In Coca-Cola – Part II

Yesterday, after Coca Cola announced earnings for the holiday quarter, the stock price fell more than 8%, the worst drop in a day since 2008. 

Coca Cola missed on revenue and the forecast for the year was disappointing.  Sales of sparkling soft drinks fell 1%, partly due to softness in North America and sales of juice and plant-based drinks dropped 2% as Coke focused less on low-value juice brands in Africa and Southeast Asia.

Two months ago, I talked about unusual options activity betting against Coca-Cola. What made this an intriguing bet against Coca-Cola was the Smart Money thinks that Coca-Cola will be trading below $40 by January 2020,

and below $30 by January 2021.

Right now the price of Coca-Cola stands at its lowest level since the 2016 election.  Based on previous measured moves, I was targeting a conservative $42 by the end of the year. With 10 months left, the Smart Money has plenty of time to be right on their options expiring in January of 2020.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

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