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Posts Tagged ‘VECO’

DARK HORSE HEDGE – What I Like About You, VECO

DARK HORSE HEDGE – What I Like About You, VECO

By Scott Brown at Sabrient, and Ilene, at Phil’s Stock World

Dancing Scotsmen waving money

What I like about you, you really know how to dance
When you go up, down, jump around,
think about true romance, yeah

That’s what I like about you

What I like about you, you keep me warm at night
Never wanna’ let you go, know you make me feel alright, yeah
 
That’s what I like about you – The Romantics

Veeco Instruments Inc. (Veeco) (VECO) designs, manufactures, markets and services enabling solutions for customers in the high brightness light emitting diode (HB LED), solar, data storage, scientific research, semiconductor and industrial markets. In its LED and Solar segment, Veeco designs and manufactures metal organic chemical vapor deposition systems that are used to make HB LEDs or solar cells made of III-V compound semiconductors. In its Data Storage segment, Veeco designs and manufactures equipment used in the production of thin film magnetic heads that read and write data on hard disk drives. In its Metrology segment, the Company designs and manufactures atomic force microscopes, scanning probe microscopes, stylus profilers and fast three-dimensional (3D) optical microscopes… (Sabrient’s Ratings Report)

Sabrient rates VECO a Strong Buy for its superior value and growth profiles, which indicates a stock that should outperform the market.  

Read Sabrient’s full report here.

We liked a lot about VECO when we added it to the Dark Horse Hedge virtual portfolio at $31.93 on August 25, 2010. Using Phil Davis’s Buy/Write strategy, we bought half a position in the stock and sold October $32 calls and puts against it (1 put and 1 call per 100 shares of stock).  

With option expirations on Friday, October 15, it’s time to decide if we "never wanna let you go," for now, or if we want to close the trade and take profits.  

VECO closed at $36.51 yesteday. We could keep the $6.20 option premium and let VECO get called away for $32. But why do that when there is so much to like about…
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DARK HORSE HEDGE – Any way the wind blows, doesn’t really matter

Housing-keeping note: Thanks to WordPress’s destruction of Phil’s Favorites site (and replacement with an invite to sign up for its service!), I’ve been relocating my blog to TypePad.  Benefits: it looks better, is very user friendly and offers an easy way to search archives for any topic. One unique feature is that while exploring the internet, I can simply click on a button to post an excerpt of an interesting article with a link to the full article. That ability allows me to post links to articles that are worth reading when I do not have reprinting permission, such as articles from major news sources. 

The new Favorites site is here.  I’ve also created a website for Dark Horse Hedge, here.  - Ilene 

DARK HORSE HEDGE – Any Way the Wind Blows, Doesn’t Really Matter

By Scott Brown at Sabrient & Ilene at Phil’s Stock World

Is this the real life? 
Is this just fantasy? 
Caught in a landslide 
No escape from reality 
Open your eyes 
Look up to the skies and see 
I’m just a poor boy (Poor boy) 
I need no sympathy 
Because I’m easy come, easy go 
Little high, little low 
Any way the wind blows 
Doesn’t really matter to me, to me

Queen, Bohemian Rhapsody

 *****

Ilene and I started the Dark Horse Hedge on July 1, 2010 with the goal of helping self-directed investors weather any storm, no matter which way the wind was blowing.  Today completes the second month of publishing the Dark Horse Hedge and we thought it would be a good time to review.  

 

September 1976:  British rock group Queen at Les Ambassadeurs, where they were presented with silver, gold and platinum discs for sales in excess of one million of their hit single 'Bohemian Rhapsody'. The band are, from left to right, John Deacon, Freddie Mercury (Frederick Bulsara, 1946 - 1991), Roger Taylor and Brian May.  (Photo by Keystone/Getty Images)

The
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Dark Horse Hedge – Don’t let the sun (profits) go down

DARK HORSE HEDGE – Don’t let the sun (profits) go down

By Scott at Sabrient and Ilene at Phil’s Stock World

3cayocostasunset0400 - Sunset on the Gulf of Mexico - Cayo Costa State Park, Florida.

Recovery in danger as firms, homebuyers cut back – AP 

Groundhog with shadow

Not exactly the kind of headline that anyone wants to wake up to, but if you simply change a few words, it is as if we have slipped into the movie Groundhog Day. Each day’s gloomy headline is much like the day before’s, with a few words changed. Fortunately, DHH began with the premise that how news is going to be headlined and short-term market moves have proven over time to be nearly impossible to predict with any consistency. 

So we seek to have long positions that are the best of the best, leveraged against short positions that are the worst of the worst.  We combine the ability to reduce beta, or market correlation, with two alpha (return) improving measures.  Our first measure is to tilt the balance of the Long/Short portfolio based on market trend, and the second is to use options for yield enhancement.

We are currently in the middle of a 5th consecutive down day for the S&P 500 and we believe in taking profits off the table when the risk/reward premise changes.  DHH recommended a short position in SunTrust Banks, Inc. on July 13, 2010 at $25.54 and following the companies $750 Million tender offer of debt on Monday, we believe it is time to cover our STI short position at these prices.  We have earned a 11.9% profit in just over a month, and so it is time to let the sun go down alone if its trend continues, but not to let our profits go down. 

BUY TO COVER SunTrust Bank, Inc. (STI) at the market, Wednesday, August 25, 2010

 

Chart from Finviz.

So what kind of positions do we want to add in this market?  One that I like and am recommending is VEECO Instruments Inc. (VECO) using Phil Davis’s buy/write strategy.  VECO has a strong buy rating from Sabrient, with excellent scores for growth and value.

Excerpt from Sabrient’s Ratings Report for VECO:  

Veeco Instruments Inc., together with its subsidiaries, designs, manufactures, and markets solutions for customers in the high brightness light emitting diode (HB LED), solar, data storage, scientific research, semiconductor, and industrial


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Ratio Put Spreader Tunes in to DISH Network Corp. Options

www.interactivebrokers.com

Today’s tickers: DISH, LBTYA, HGG, VECO, WBMD, VLO & TFSL

DISH – DISH Network Corp. – The implementation of a ratio put spread on the U.S. provider of direct broadcast satellite subscription television service this afternoon was perhaps put on by an investor looking to lock in recent share price gains. DISH shares, which are currently up 2.4% on the day to arrive at $20.77 by 3:40 pm ET, have rebounded nearly 17.5% since touching down to $17.75 on July 1, 2010. It looks like one trader purchased 3,000 puts at the December $20 strike for an average premium of $1.58 each, and sold 6,000 puts at the lower December $18 strike for an average premium of $0.83 a-pop. The investor responsible for the transaction receives a net credit of $0.08 per contract, and keeps the full amount at long as DISH’s shares exceed $20.00 through December expiration. The trader is perhaps utilizing the spread to protect the value of a position in the underlying shares. If this is the case, downside protection kicks in should shares reverse course to trade below $20.00 by expiration day. The decision to employ a ratio spread rather than a 1-by-1 spread or a plain-vanilla long put stance suggests this investor does not expect DISH shares to collapse ahead of expiration at the end of 2010. The firm is scheduled to report second-quarter earnings ahead of the opening bell on August 9, 2010.

LBTYA – Liberty Global, Inc. – It looks like one options strategist expects shares of the international producer of video, voice and broadband internet services to remain range-bound through October expiration. Liberty Global’s shares are currently down 0.20% to stand at $29.65 as of 3:05 pm ET. LBTYA reported an adjusted net loss of $2.42 a share for the second quarter of 2010 after the market closed on Tuesday. But, shares moved very little following earnings. Perhaps the lack of fluctuation in the price of the underlying shares during earnings season bolstered the strangle seller’s premonition that LBTYA’s shares are likely to trade within a specified range for the next couple of months. The investor appears to have sold roughly 10,000 puts at the October $27.5 strike for a premium of $0.70 each in combination with the sale of about the same number of calls at the October $32.5 strike for an average premium of $0.35 apiece. The trader pockets…
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Take-Off Tuesday Already?

Wow, this market goes from zero to sixty in record time, doesn’t it? 

Our 1,113 mark (see yesterday’s post for charts) was tested and broken on the S&P yesterday (see David Fry’s chart) on a silly stick save into the close but, seeing that, it was very obvious that "they" are looking to paint some impressive moves on the charts this week so strap yourselves in – it’s going to be a wild one.

1,120 is our next big test on the S&P along with the satanic 666 on the Russell and 10,700 is the next big test for the Dow (as 10,500 seems well in hand).  Advancers led decliners 20:1 on the Nasdaq, which shows you what a total farce the market is because we had the same ratios going down so stocks are either ALL good or ALL bad on a random daily basis.  Human beings do not trade this way my friends, this market has been totally taken over by machines and the affect of your individual trading is about the same as shotting a water gun into a wave to slow it down.  

As long as you accept this fact and "go with the flow" you can be a very happy channel surfer but fight the tide at your own peril!  We stuck to hedged plays in yesterday’s Member Chat with our bearish play on FSLR in the Morning Alert and then earnings spreads on MEE and VECO along with long-term bullish plays on LYG, GS, CHK and our beloved TBT, who are finally showing signs of life.  We also keep selling GENZ calls to overly enthusiastic buyers who think someone is going to pay more than $70 for the company – even though it was at $50 before the rumors started.  Aside from the lack of logic that a buyer with a p/e of under 10 will pay a p/e of over 20 for GENZ, it just isn’t really the right credit environment for buyers to be bidding +40% for a company.  We aren’t buying puts but we’ll certainly sell Jan $70 calls for $4 as that’s just silly! 

The markets are back in "Soar and Ignore" mode this morning as bad news is now like water off a duck’s back to the market, much the same way good news was ignored just 2 weeks ago.  The moon is full this week so I’m going to start charting that against the market as we’re still trying to find some sort of early predictor of…
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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!

 
 

Zero Hedge

Russia is de-dollarizing

Courtesy of ZeroHedge. View original post here.

Submitted by Gold Standard Institute.

 

The ruble and other currencies do not compete against the dollar. They are dollar derivatives.

The dollar is headed to ruin, but that doesn’t mean that any other paper currency can replace it. The others will fail first.

The dollar will fail last.

 

The failure of the dollar, and the transition to gold happens to be the theme of an event The Gold Standard: Both Good and Necessary, in New York on Nov 1. There hasn’t been a real recovery from the crisis of 2008, and there won’t be until we return to the use of g...



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Chart School

Time for the Pullback?

Courtesy of Declan.

Sellers were going to make an appearance at some point and today was the day they paid a visit. Whether a larger pullback emerges will depend on events over the coming days, but today's selling did emerge at some natural attack points for shorts.

The S&P finished with a 'bearish cloud cover,' but it did manage to hold declining resistance turned support, and the 20-day MA has entered the fray as an area for bears to work. But this wasn't the most bearish of the indices, and today's finish actually gives bulls a long play tomorrow (for a bounce off support).  Technicals also suggest a bounce.


While the S&P may give bulls something tomorrow, th...

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Option Review

LUV Options Active Ahead Of Earnings

There is lots of action in Southwest Airlines Co. November expiry call options today ahead of the air carrier’s third-quarter earnings report prior to the opening bell on Thursday. Among the large block trades initiated throughout the trading session, there appears to be at least one options market participant establishing a call spread in far out of the money options. It looks like the trader purchased a 4,000-lot Nov 37/39 call spread at a net premium of $0.40 apiece. The trade makes money if shares in Southwest rally 9.0% over the current price of $34.32 to exceed the effective breakeven point at $37.40, with maximum potential profits of $1.60 per contract available in the event that shares jump more than 13% to $39.00 by expiration. In September, the stock tou...



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Phil's Favorites

Larry Swedroe: Use Valuations for Expected Returns, Not Market Timing

Larry Swedroe: Use Valuations for Expected Returns, Not Market Timing

Courtesy of 

When forecasting investment returns, many individuals make the mistake of simply extrapolating recent returns into the future. Bull markets lead investors to expect higher future returns, and bear markets lead them to expected lower future returns. But the price you pay for an asset also has a great impact on future returns. Consider the following evidence:

The average historical P/E ratio for the market has been around 15. A study covering the period from 1926 through the second quarter of 1999 found that an investor buying stocks when the market traded at P/E ratios of between 14 and 16 e...



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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Insider Scoop

UPDATE: Brean Capital Initiates Coverage On GrubHub

Courtesy of Benzinga.

Related GRUB UPDATE: JMP Securities Initiates Coverage On GrubHub Inc Benzinga's Top Initiations Making Money With Charles Payne: 09/25/14 (Fox Business)

Brean Capital initiated coverage on GrubHub Inc (NYSE: GRUB) with a Hold rating.

Analyst Tom Forte noted that "catalysts for the stock include an accelerat...



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Sabrient

Sector Detector: Sharp selloff in stocks sets up long-awaiting buying opportunity

Courtesy of Sabrient Systems and Gradient Analytics

Last week brought even more stock market weakness and volatility as the selloff became self-perpetuating, with nobody mid-day on Wednesday wanting to be the last guy left holding equities. Hedge funds and other weak holders exacerbated the situation. But the extreme volatility and panic selling finally led some bulls (along with many corporate insiders) to summon a little backbone and buy into weakness, and the market finished the week on a high note, with continued momentum likely into the first part of this week.

Despite concerns about global economic growth and a persistent lack of inflation, especially given all the global quantitative easing, fundamentals for U.S. stocks still look good, and I believe this overdue correction ultimately will shape up to be a great buying opportunity -- i.e., th...



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Digital Currencies

Goodbye War On Drugs, Hello Libertarian Utopia. Dominic Frisby's Bitcoin: The Future of Money?

Courtesy of John Rubino.

Now that bitcoin has subsided from speculative bubble to functioning currency (see the price chart below), it’s safe for non-speculators to explore the whole “cryptocurrency” thing. So…is bitcoin or one of its growing list of competitors a useful addition to the average person’s array of bank accounts and credit cards — or is it a replacement for most of those things? And how does one make this transition?

With his usual excellent timing, London-based financial writer/actor/stand-up comic Dominic Frisby has just released Bitcoin: The Future of Money? in which he explains all this in terms most readers will have no tr...



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OpTrader

Swing trading portfolio - week of October 20th, 2014

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Market Shadows

Falling Energy Prices: Sober Look takes a Sober Look

Falling Energy Prices: Sober Look takes a Sober Look

What do falling energy prices mean for the US consumer? Sober Look writes a brief yet thorough overview of the consequences of the correction in the price of crude oil. There are good aspects, particularly for the consumer, bad aspects, and out-right ugly possibilities. For more on this subject, read James Hamilton's How will Saudi Arabia respond to lower oil prices?  In previous eras, Saudi Arabia would tighten the supply to help increase prices, but in this "game of chicken," the rules m...



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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's this week's Stock World Weekly. Just sign in with your PSW user name and password. (Or take a free trial.)

#457319216 / gettyimages.com

 

...

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Promotions

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Pharmboy

Biotechs & Bubbles

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Well PSW Subscribers....I am still here, barely.  From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.

First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices.  Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment.  Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer.  For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...



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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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