On November 12, 2018, we recommended buying to open the Johnson & Johnson (JNJ) December 2018 145 put, as it traded at just $2.85.

It’s now up to $13.15… and we’re recommending that you take the win ahead of expiration this Friday.  But we’re recommending more ways to trade likely downside.

Johnson & Johnson didn’t have a great day on Friday.

We, however, did with JNJ put options on hand.

In fact, the stock fell more than 9%, or $13 a share on a Reuters report that the drug and consumer products company new for decades that its baby talcum powder was contaminated with asbestos. Reuters said an examination of company memos and other documents found the company was well aware of small amounts of the carcinogenic in the powder.

According to Market Watch:

“The documents showed that internally, executives, mine managers, scientists, doctors and lawyers were worried about the problem of its raw talc and finished powders testing positive for the substance. But they denied all claims until they were compelled to share thousands of pages of documents with lawyers, representing some 11,700 plaintiffs who claim the talc gave them cancer, including thousands of women with ovarian cancer, the report found.”

If it’s found that Johnson & Johnson did know and was responsible for potential cancer in users of the product, a $13 drop is the least of its concerns. In fact, legal issues could quickly mount. Plus, we’re likely to see the stock plummeted far more than it is today.

There are two potential ways to trade JNJ.

One is to short the stock outright. Another potential way to make money is by buying to open put options on the JNJ stock, including the JNJ January 18, 2019 130 put and the JNJ February 15, 2019 130 put. All could provide great returns if JNJ was negligent.

Stay tuned for more on this developing story.