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Options traders are betting that GrubHub is headed for the gutter

Options traders are betting on Grubhub's pain to continue

The markets have taken a big bite out of GrubHub this week. The food delivery stock is down more than 10% since Monday, and options traders think it's going to be a while before the market regains its taste for the company.

"This one's interesting because it's not one that you see a whole heck of a lot of options volume in," Dan Nathan, principal at Risk Reversal Advisors, said Thursday on "Fast Money," "but today, put volume was three times that of calls, and there seemed to be buyers of the September 50-puts."

As Nathan pointed out, more than 9,000 of those contracts traded in small lots for an average of about $1.28 in premium per contract. While that means there wasn't one big blockbuster trade in the name, it does signify that many traders are on the same page about GrubHub's near-term future.

Those contracts would break even if GrubHub trades below $48.72 by September expiration, or about 17% below Thursday's close.

"That seems like a pretty significant move, but here's the thing: This stock is down 60% from its all-time highs made last year. It's down 24% on the year, and just made a new 52-week low today," said Nathan.

As Nathan would note, this company isn't the only one struggling in the food delivery space as a turf war rages on. Uber, which runs Uber Eats, hasn't performed well since its May IPO, while companies in the space which have yet to go public continue to make moves.

"We also know that they've got two massive competitors. Doordash, which is valued at $12 billion versus GrubHub's $5 billion public market cap, and they're spending a lot of that VC money to get growth," he said, "and to get to the public market, and obviously there's Postmates, too."

But GrubHub is emblematic of a larger trend in the markets, as well, according to Nathan.

"This huge run-up, this is the bullishness that was surrounding all of these tech unicorns that were preparing to come to the public markets," he said.

"You know what happened here?" asked Nathan, referencing the point at which GrubHub's stock price fell off a cliff.

"Growth started to decelerate meaningfully as Uber and Postmates and Doordash started to, kind of, gear up to go public."

GrubHub was slightly higher Friday.