Fastenal Company (FAST) is Minnesota based industrial construction equipment and hardware supplier. At the time of this post (11:00AM CST), FAST is currently trading at 42.68, down 6.77% on the day. The stock is currently trading well within the lower portion of its 52 week range of 40.18-52.21 after today’s significant gap lower on the market open has continued to sell off and push FAST back towards the yearly lows that printed in mid-October.
Earlier this morning at approximately 10:03AM, OptionHacker detected and flagged some unusually bearish options activity in FAST as over 10,200 of the Mar ’15 43.0 strike puts traded in a sweep transaction that lifted the offer across multiple exchanges. This large block transaction went off at the ask of 1.55, and when compared to the minimal open interest of just 12 contracts in the strike going into the day, we can confidently surmise this was an opening bearish transaction. With an initial cash outlay of about $1,585,500 before commissions, the trader who got long these puts will be looking for a continuation lower in FAST, back towards the 52 week lows going into the monthly March options expiration 44 days out. The current technical setup seems to confirm this bearish bias, as FAST is now below the Ichimoku Cloud and most relevant moving averages on the daily chart. While there has been no confirmed news out on the company at this point that would explain today’s bearish action, we will be keeping a close eye on FAST moving forward, and looking for a move lower in the coming month.
Trade: A trader bought 10,231 FAST Mar 43 Puts for $1.55
Risk: $155 per 1 lot
Breakeven: $41.45
This is a nearly $1.6 million bet that FAST sells off through March expiration. FAST is looking weak below the cloud today.
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