This morning, health insurer Coventry Health Care (CVH) announced second-quarter earnings of $83.2 million, or 55 cents per share, one revenue of $2.98 billion. Analysts had expected a profit of 55 cents per share on sales of $3.02 billion. Coventry's medical expenses rose 41% to $2.27 billion. The company's premium revenue grew 31% to $2.64 billion, and management services revenue rose 6% to $334.2 million.

Meanwhile, the firm reaffirmed its full-year profit forecast of $3.65 to $3.75 per share. For the third quarter, CVH forecast earnings between $1.05 and $1.09 per share. According to a Thomson Financial poll, analysts expect a profit of $1.05 per share in the third quarter and $3.62 per share for the full year.

The shares are trading slightly lower this afternoon following the company's results. The security has been trapped in a long-term downtrend under its 10-week and 20-week moving averages since late January 2008, resulting in a loss of 45%.

Not surprisingly, investors are extremely skeptical of the shares. The Schaeffer's put/call open interest ratio for CVH is at an annual peak of 0.76, indicating that short-term options speculators have not been more pessimistically aligned toward the shares during the past 12 months.

In options trading today, investors have focused on the stock's August 30 put, which has seen volume of more than 2,600 contracts. Open interest for this out-of-the-money option stands at roughly 3,800 contracts, making it hard to determine if these are new positions or if options players are closing out existing positions following the company's earnings report.