Why Darden Restaurants Options Suggest Further Downside Ahead

On CNBC's "Options Action," Michael Khouw of Optimize Advisors said that Darden Restaurants, Inc. DRI traded 18 times the average daily put volume on Wednesday. Puts outpaced calls by 3-to-1, he added.

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There was a buyer of 1,000 of the October 130/115 1x2 put spreads at an average price of $2.40 per contract, Khouw mentioned. The trader expects shares of Darden Restaurants to decline by 13% by October expiration, he added.

DRI Price Action: Shares of Darden Restaurants were down 3.41% premarket Thursday at $126.80 following the company's first-quarter report.