Put Spread Sold on J Crew (JCG)

Shares of J Crew Group Inc. JCG are lower on the session by 3.96%, currently trading $42.92 after the company was downgraded to Market Perform at BMO Capital. The stock has been a relative outperformer over the past few weeks, though has broken through the 50-day moving average as of late. I am seeing a put spread sold in the name today, betting that the stock will not fall past the $39.60 mark. The June $40/37.50 put spread was sold 1,638 times for $0.40 a short while ago. Volume exceeded open interest on both strikes, indicating that this is fresh positioning. It is possible that this spread was sold against short shares. If this were the case it would indicate that the trader believes the max downside for the stock is $37.50. J.Crew Group, Inc. is an integrated multi-brand, multi-channel, specialty retailer. The Company offers complete assortments of women's, men's and children's apparel and accessories.