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Traders bet on another plunge for Apple

Options Action: More pain for Apple?

Apple has fallen about 7 percent since it reported earnings earlier in July. And some options traders think there's more pain to come for the popular stock, betting on another 7 percent drop over the next month.

"Now with the stock down, we're actually seeing more bearish bets than bullish bets," CNBC contributor Mike Khouw said Thursday on CNBC's "Fast Money," referring to the number of put contracts versus call contracts that have been purchased over the past week.

Khouw said bearish bets outweighed bullish bets by 10 percent on Thursday. Specifically, traders were buying the September 115-strike put for $1.50. The trade will be profitable if Apple falls below $113.50 by the September expiration.

And if Apple reaches $113, that could mean trouble for the tech giant, Khouw said.

"When you get down to those levels, you're looking at a valuation where the company's going to be trading at about less than 10 times its full year earnings when you exclude the cash," Khouw said. "Obviously there are some people who think there is some kind of a real problem going on here."

Apple reported second-quarter earnings that beat analyst estimates but still saw a notable drop in stock price following the report. Traders and analysts have expressed concern over declining sales in China, one of the company's largest markets.

Read More Apple to unveil next Apple TV version in September: BuzzFeed

Although Apple options trading volume was less than its average on Thursday, Khouw said it still made up a large portion of trading activity. About one in 20 of all options that trade in the United States are Apple options, Khouw said Thursday.

However, the majority of analysts are still bullish on Apple. Seventy-three percent have a "buy" rating on the stock, with an average price target of $146.

Apple shares are up more than 10 percent year to date. The stock fell less than 1 percent after opening bell on Friday, trading around $122.

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