Put Options on PETM on 3/28/2013

PetSmart (PETM) operates as a specialty retailer of products, services, and solutions for pets in the United States, Puerto Rico, and Canada. Shares of this specialty retailer have performed well last year but money has started to come out of this stock this year.

The company offers consumables, and hardgoods, which include pet supplies and other goods comprising collars, leashes, health care supplies, grooming and beauty aids, toys, apparel, and pet beds and carrier. In addition, the company operates PetsHotels that offer boarding for dogs and cats; provides personalized pet care, an on-call veterinarian, temperature controlled rooms and suites, daily specialty treats and play time, and day camp services for dogs; and operates veterinary hospitals, which offer services comprising routine examinations and vaccinations, dental care, a pharmacy, and surgical procedures.

Shares have formed a bearish triangle or pennant after the company's latest quarterly report. Fourth quarter 2012 earnings per share came in at $1.24, up 36% from the 91 cents earned in the same quarter a year ago. The EPS was also better than expected at $1.21 a share. Looking ahead, the company forecasts EPS between $3.76 and $3.92,  shy of analysts’ expectations of $3.97.

52-Week Trading Range: $54.20 - $72.75

Last Trade: $61.84

Trade Buy 1 May $62.50 Put at $2.15 For a net debit of $2.15 Profit/Loss Analysis Breakeven at $60.35 Maximum profit is unbounded Maximum loss is ($215.00) at strike of $63.00 Closing Summary Sold 1 May $62.50 Put at $0.00

Position closed on 5/17/2013 at price of $0.00 with a -100.00% loss in 50 days.

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