Autodesk's Reporting Issue Drives Demand for Price Protection Amid Sell-Off

The stock tumbled 4.9% to $217.03 as of 12:39 p.m. in New York after the company said it won't be able to meet the 15-day extension period for the filing of its annual report because the internal investigation being conducted by its audit committee is still ongoing.

Autodesk has been on a downturn trend after the company told the Securities and Exchange Commission on April 1 that its audit committee started an investigation into the company's free cash flow and adjusted operating margin practices, with help from outside counsel and advisors.

Wednesday morning's block trade for 1,520 put options represents about 95% of the total volume for that $230 put option, according to data compiled by moomoo. Each put is for 100 shares. The more than 1,600 contracts traded as of noon in New York Wednesday is the highest since at least September 2023, when trading activity for such puts started to pick up, data tracked by moomoo showed. Volume for such puts soared from just 127 a day earlier, as the price of the contract climbed more than 260%.  

At that exact time, another block trade, this time involving put options that give the holder the right to sell 152,000 Autodesk shares at $220 by the end of the week, was also posted. The seller stands to collect a $1.77 million premium for that trade. The price of those puts soared 364% to $7.20 a share as the stock fell deeper below that $220 strike price.

Wednesday was the first time Autodesk has seen such block trades in at least a month, data compiled by moomoo showed.

While the company reiterated Wednesday that  it doesn't believe that the probe will affect any previously issued financial statements or its earnings release on Feb. 29, Citi analyst Tyler Radke was concerned that the delays could signal the issue "could be more complex," Barron's reported.

"We're less confident it won't have any impact on results/targets/guidance," Barron's quoted Radke as saying.

Still, 12 of the 15 technical indicators tracked by moomoo signal the stock is oversold and could be poised for a rebound.

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