With hacking and security breaches consistently making headlines, you’d think cybersecurity stocks would be setting new highs. However, Palo Alto Networks PANW – NYSE has been establishing lower lows and lower highs for over two years.
Is it now starting to reverse the trend? After exhibiting some recent signs of strength, a trader bought 3,000 PANW September 160 calls for $2.35 apiece earlier today.
Costing $705,000, PANW needs to increase 16.5% to the break-even price at $162.35 for this trade to pay off by expiration. PANW is prone to making out-sized swings, with the stock fluctuating at least 16% on both of the last two earnings announcements alone.
If upcoming earnings on August 28 juices PANW to the upside, our trader is in line to make $300,000 for every dollar above the break-even threshold.
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