Healthcare facility REIT
Medical Properties Trust (MPW) is down 10% over the past year, amid a slowdown in revenue and earnings. One trader sees shares trending lower into the spring of 2025.
That’s based on the March 21, 2025 $3.50 puts. With 113 days until expiration, 30,401 contracts traded compared to a prior open interest of 422, for a 72-fold rise in volume on the trade. The buyer of the puts paid $0.38 to make the bearish bet.
Medical Properties shares recently traded for about $4.50, so the shares would need to drop by $1, or about 22%, for the option to move in-the-money. Shares currently trade about midway between their 52-week high of $6.65 and the 52-week low of $2.92.
Shares have been trending down in recent weeks. MPW has lost money over the past year, but has had two big spikes higher over $6 per share before coming down, and may be a repeatable stock pattern for the foreseeable future.
Action to take: Shares are currently trending down, so interested investors should avoid buying the stock until it breaks under $4.
Traders should stick with put options for now. The stock has popped higher after hitting the $4.00 price range several times this year, so that could be a good price point to take profits on put options and flip to a call option trade.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.