Today’s tickers: CBS, DWA & EEM

CBS - CBS Corp. – Shares in media and entertainment company, CBS Corp., are advancing today ahead of the company’s first-quarter earnings report after the closing bell. The stock is up 1.2% at $46.31 just after midday in New York, but options activity on CBS this morning indicates some traders are bracing for the price of the underlying to pull back. Front month at- and out-of-the-money put options are the most actively traded contracts as measured by volume, with the $44 strike calls seeing the most volume of any single striking price. Less than 10 minutes after U.S. markets opened for trading today, one or more traders started snapping up the May $44 strike puts, buying roughly 2,500 lots at an average premium of $0.55 each. The bearish options make money if shares in CBS drop more than 6.0% from the current level to breach the average breakeven point on the downside at $43.45 by May expiration. Options traders appear to be buying the May $45 and $46 strike puts today as well.

DWA - DreamWorks Animation SKG, Inc. – Shares in DreamWorks Animation are up more than 6.0% at $20.46 near midday in New York after the company reported a surprise first-quarter profit and higher-than-expected revenue after the closing bell on Tuesday. According to a press release issued by the Glendale, California-based company this morning, DreamWorks agreed to acquire AwesomenessTV, a teen network on YouTube, for approximately $33 million in cash. Shares in DreamWorks are up more than 25% year to date, and it looks like some options players are positioning for the stock to extend gains in the near term. The Jun $22.5 strike calls attracted the most volume during the first half of the trading session, with upwards of 2,800 lots changing hands versus open interest of 733 contracts. Time and sales data indicates the bulk of the volume was purchased at a premium of $0.25 each. The bullish position starts making money if shares in DWA rally 11% over the current price of $20.46 to surpass the average breakeven point at $22.75 by June expiration. Shares in DreamWorks last traded above $22.75 in November of 2012 when the stock touched a 52-week high of $22.98.

EEM - iShares MSCI Emerging Markets Index ETF – Options volume on the iShares MSCI Emerging Markets Index ETF jumped during the first hour of the trading session on Wednesday after a massive position was initiated in the May expiry put contracts. The EEM snapped a two-day winning streak this morning, with shares down 0.70% at $43.00 as of 11:20 a.m. ET. The largest trade in EEM options today was the purchase of 240,000 puts at the May $42.5 strike at a premium of $0.43 per contract. The bearish position makes money if shares in the EEM decline another 2.2% from the current level to breach the effective breakeven price of $42.07 by May expiration. Shares in the EEM are down roughly 4.0% since the start of 2013.