Put Options on SCHL on 6/10/2019

Scholastic Corporation (SCHL) publishes and distributes children's books worldwide.

It operates in three segments: Children's Book Publishing and Distribution, Education, and International.

The Children's Book Publishing and Distribution segment publishes and distributes children's books, e-books, media, and interactive products through its school book club and school book fair channels, as well as through its trade channel. Its original publications include Harry Potter, The Hunger Games, The 39 Clues, Spirit Animals, The Magic School Bus, I Spy, Captain Underpants, Dog Man, Goosebumps, and Clifford The Big Red Dog; and licensed properties comprise Star Wars, Lego, Pokemon, and Geronimo Stilton. In addition, this segment publishes and creates books plus products for children, including titles, such as Sew Mini Treats, Lego Chain Reactions, and Make Your Own Bath Bombs under the Klutz name.

Shares have formed a bearish "flag" and are expected to move lower following the company's latest quarterly report. Scholastic Cp (SCHL) reported a 3rd Quarter February 2019 loss of $0.32 per share on revenue of $360.1 million. The consensus estimate was a loss of $0.27 per share on revenue of $371.1 million. 

The company said it expects fiscal 2019 earnings to be at the low-end of its previous guidance range of $1.60 to $1.70 per share and remains on track for revenue of $1.65 billion to $1.70 billion. The current consensus earnings estimate is $1.53 per share on revenue of $1.70 billion for the year ending May 31, 2019.

Last Trade: $33.00

Trading Range: $31.38 - $47.94

Trade Buy 1 June $35.00 Put at $2.25 For a net debit of $2.25 Profit/Loss Analysis Breakeven at $32.75 Maximum profit is unbounded Maximum loss is ($225.00) at strike of $35.00 Closing Summary Sold 1 June $35.00 Put at $1.75

Position closed on 6/21/2019 at price of $1.75 with a -22.22% loss in 11 days.

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