nited Therapeutics announced on Sept 1st, a 2:1 stock split. Looking at the historical price and the volume, it looks like a stock split that I would "short". Why? I traded another 100 dollar stock back in Mar 09 and it rose about 6% in the first 3 days after I bought it....then it tanked in part due to the financial fallout but I think there is a lower threshold for safety in a 100 dollar stock as compared to a 30-50 dollar stock. At 100 a share, with NEGATIVE earnings, UTHR seems way overvalued. How would I play this one? I would buy some OCT PUTS, FUHVQ.X trading at 1.90. This has downside potential and I just believe this stock will be between 85-90 a share before the end of the month. Oct options expire after 16 Oct, but I would plan on cashing around the 22-23 of Sep. Friday, FUHVQ.X traded at 1.90 so 1 option (controlling 100 shares) would cost $190. I blogged about this at http://tradingstocksplits.blogspot.com
$93.22 (09/06/09)
