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Options Action: Ralph Lauren

With shares of Ralph Lauren 34% higher over the past year, the stock landed on many radars Wednesday, after the company missed expectations.

Of greatest concern, the company said higher costs for raw materials like cotton and the disruption to its business in Japan following the earthquake and tsunami would hurt full-year margins.

How should you position now? Mike Khouw of Cantor Fitzgerald suggests the following options trade!

Get all the details. Watch the video now!




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Trader disclosure: On May 25, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s “Fast Money” were owned by the “Fast Money” traders; Kinahan owns (AKS); Kinahan owns (CSCO), is short (CSCO) calls; Kinahan owns (F), is short (F) calls; Kinahan owns (GE) is short (GE) calls; Kinahan owns (MSFT) is short (MSFT) calls; Kinahan owns (NYT); Kinahan is short (SLV) through multiple options; Kinahan owns (YHOO); Adami owns (AGu); Adami owns (C); Adami owns (GS); Adami owns (INTC); Adami owns (MSFT); Adami owns (NUE); Adami owns (BTU); Terranova owns (XOM); Terranova owns (KSS); Terranova owns (CVI); Terranova owns (OXY); Terranova owns (TM); Terranova owns (BJ); Terranova owns (DIS); Terranova owns (PFE); Terranova owns (V); Terranova owns (HPQ); Terranova owns (FLX); Terranova owns (JPM); Terranova owns (MCD); Terranova owns (PEP); Terranova owns (VRTS); Terranova is short (DELL); Finerman and Finerman's firm own (AAPL);Finerman's Firm owns (BP); Finerman's Firm owns (CAT) calls; Finerman owns (C); Finerman's Firm owns (IBM); Finerman and Finerman's Firm own (JPM); Finerman's Firm owns (JPM) Leaps; Finerman and Finerman's Firm own (MSFT); Finerman's Firm owns (TGT); Finerman owns (UNG); Finerman owns (USO); Finerman's Firm is short (IWM), (SPY); Finermna's Firm owns S&P 500 Puts; Finerman's Firm owns Russell 2000 Puts


For Joe Terranova
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
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Virtus Investment Partners Owns More Than 1% Of DOMINO'S PIZZA UK & URL PLC
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CNBC.com with wires.