RHI Unusual Options: $840K Staffing Recovery (Aug 18)
Coordinated institutional flow hit RHI tape at 12:04:50 with simultaneous $465K call buying at $40 strike and $375K put selling at $30 strike, both expiring Dec...
💥 RHI Risk Reversal Alert: Unusual Score 7.8/10 - Smart Money Bets $465K on Staffing Recovery Play
Quick Take
Coordinated institutional flow hit RHI tape at 12:04:50 with simultaneous $465K call buying at $40 strike and $375K put selling at $30 strike, both expiring December 2025. This classic risk reversal structure signals smart money positioning for moderate upside with downside protection, betting on staffing sector stabilization as small business confidence recovers.
YTD Performance Snapshot
RHI has been crushed -47.72% YTD, currently trading at $35.82 after a brutal decline from January highs near $70. The stock has found support in the $33-36 range since May, suggesting potential bottoming action ahead of key catalysts.
Key Price Levels: - Current: $35.82 - YTD High: ~$70 (January peak) - YTD Low: ~$33 (multiple tests since May) - Resistance: $40-42 zone (option strike target) - Support: $30-32 zone (put strike protection)
The Options Tape Breakdown
📊 Option Flow Analysis
Detailed Trade Table (Both trades at 12:04:50)
| Time | Symbol | Buy/Sell | Call/Put | Expiration | Premium | Strike | Volume | OI | Size | Spot | Option Price |
|---|---|---|---|---|---|---|---|---|---|---|---|
| 12:04:50 | RHI | BUY | CALL | 2025-12-19 | $465.0K | 40.0 | 3,000 | 292 | 3,000 | $35.76 | $1.55 |
| 12:04:50 | RHI | SELL | PUT | 2025-12-19 | $375.0K | 30.0 | 3,000 | 179 | 3,000 | $35.76 | $1.25 |
Block Trade Analysis (12:04:50 timestamp)
CALL PURCHASE (Bullish Bet): - $40 Strike (12/19/2025 expiry): - Volume: 3,000 contracts - Premium paid: $465K - Trade type: MID execution - Open Interest: 292 (10x volume surge) - Interpretation: Moderate bullish positioning for year-end recovery
PUT SALE (Premium Collection): - $30 Strike (12/19/2025 expiry): - Volume: 3,000 contracts - Premium collected: $375K - Trade type: BID execution - Open Interest: 179 (17x volume surge) - Interpretation: Downside risk acceptance at $30 support level
Trade Flow Metrics
- Total Volume: 6,000 contracts
- Net Premium Outlay: $90K ($465K paid - $375K collected)
- Spot Reference: $35.76 at execution
- Upside Target: +11.8% to $40 strike
- Downside Buffer: -16.1% to $30 strike
Unusual Score Meter: 7.8/10
Score Breakdown:
- Premium Size (8/10): $465K single block on calls - institutional size for mid-cap
- Strike Selection (7/10): Conservative 11.8% OTM calls with 16% downside cushion
- Timing Factor (8/10): Positioned 4 months ahead of year-end recovery thesis
- Volume/OI Ratio (9/10): 10x and 17x normal volume on respective strikes
- Strategy Sophistication (7/10): Risk reversal shows professional execution
Verdict: Institutional player using sophisticated structure to express moderate bullish view while minimizing capital outlay. Classic value play on beaten-down dividend stock.
Catalyst Calendar & Market Movers
Immediate Term (Next 30 Days)
- August 25, 2025: Ex-dividend date for $0.59 quarterly payment - 6.5% annual yield provides floor
- October 28, 2025: Q3 2025 Earnings Report - Key inflection point for recovery narrative
Near-Term Recovery Drivers
- Labor Market Normalization: Fed rate cuts expected to boost small business hiring - Direct benefit to staffing demand
- Protiviti Consulting Growth: International expansion driving resilience - Offsetting traditional staffing weakness
- AI/Digital Transformation: Investment in tech-enabled matching platforms - Adaptation to hybrid work trends
Valuation & Technical Setup
- Dividend Support: 21-year streak of dividend increases - Income investors provide downside protection
- Historical Discount: Trading near 52-week lows with P/B and P/S at multi-year lows
- Cost Discipline: Operational efficiency initiatives underway - Margin expansion potential
Trading Playbook
Strategy 1: Replicate the Risk Reversal
Setup: Sell 12/19 $30P, Buy 12/19 $40C - Net debit: ~$30 per spread - Max profit: Unlimited above $40 - Max loss: $3,000 if stock below $30 - Breakeven: ~$40.30
Strategy 2: Conservative Call Spread
Setup: Buy 12/19 $37.5C, Sell 12/19 $42.5C - Net debit: ~$150 per spread - Max profit: $350 above $42.50 - Max loss: $150 if stock below $37.50 - Risk/Reward: 2.3:1
Strategy 3: Dividend Capture with Covered Calls
Setup: Buy 100 shares, Sell monthly $38-40 calls - Collect 6.5% dividend yield - Generate additional premium income - Participate in gradual recovery
The Trader's Corner
Today's risk reversal is textbook smart money positioning in a beaten-down value stock. The simultaneous execution at identical timestamps screams institutional desk trading, not retail flow. Key observations:
- Net premium outlay of just $90K - Minimal capital at risk for $1.4M notional exposure
- December expiry - Allows time for Fed cuts and Q3/Q4 earnings to play out
- Strike selection - $40 target aligns with technical resistance and analyst price targets
The 6.5% dividend yield provides a safety net that's attracting income investors while the company stabilizes. With RHI down nearly 50% YTD while maintaining its dividend, the risk/reward has shifted favorably for patient capital.
Bottom Line: This isn't a moonshot bet - it's calculated institutional positioning for a moderate recovery in a dividend aristocrat trading at distressed valuations. The downside protection at $30 combined with upside participation above $40 creates an asymmetric opportunity as staffing markets normalize.
Risk Factors: - Extended economic uncertainty delaying hiring recovery - Further margin compression if cost cuts prove insufficient - Structural disruption from AI/automation in staffing sector
Trade carefully - this is a recovery play, not a growth story.