Tony Zhang's Disney Trade

Tony Zhang's Disney TradeOn CNBC's "Options Action," Tony Zhang suggested that investors should consider a Bearish option trade in Walt Disney Co (NYSE: DIS).The company is going to report earnings on Tuesday and Zhang thinks risks are skewed to the downside.He is concerned about Disney's poor relative strength to Communication Services Select Sector SPDR Fund (XLC) and relatively weak guidance from analysts.Zhang expects to see a significant decline in the theme park revenue and soft numbers from the media and studios segment. Disney+ is the only part of the business that is growing, but its numbers for 2Q are not very attractive, explained Zhang.To make a Bearish trade, Zhang wants to buy the August $115/$105 put spread for a total cost of $2.90. The trade breaks even at $112.10 or 4.14% below the current stock price. If the stock drops to $105 or lower, the trade is going to reach its maximal profit of $7.10.See more from Benzinga * 'Options Action's' Final Call From July 31 * 'Fast Money Halftime Report' Picks For July 21: Pepsi, Disney And More * 'Halftime Report' Traders Share Their Thoughts On Netflix, Disney And ViacomCBS(C) 2020 Benzinga does not provide investment advice. All rights reserved.