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Philstockworld June Portfolio Review – Members Only

Image result for one million dollars animated gifYes, I am being lazy (some would say efficient), this is Friday morning's Report because not much is going on and these Reviews take forever to write so I'm getting a jump by doing them as we go along today.

$1,405,302!  

That is up $271,547 (24%) for our paired portfolios since our last review and we've made very few changes to the LTP in the past month – the market's move higher just worked well for our leveraged positions, which are still pretty bullish from that bottom action in March.  The S&P 500 was at 2,863 back on May 15th and now it's 3,135 – up 272 points is right about 10%.  That's why we keep spending money on those hedges in our Short-Term Portfolio – we want to lock in those ridiculous gains.

We didn't do a lot of buying this month, we added FL, HMY, IMAX, KO and TIF, who were all still bargains from our Watch List but, for the most part, things have gotten too expensive to be of much interest so we are wating PATIENTLY (right guys?) for earnings – when it's certain to be bargin-hunting time again.  

Meanwhile, as our Members are certainly aware, I think being up $800,000 from our $600,000 start to the year is a bit too much money to be making so I am VERY inclined to take it all off the table and start from scratch (keeping the $800,000 in our pockets so we can't possibly have a losing year).  We could be super-aggressive in the new portfolios and it would be fun but people hate it when I do that (even though it's sensible) so I'm simply going to say that if the combined Long and Short-Term Portfolio values drop below $1.2M (up 100%), we will be shutting them down (along with the rest as their health is a good indicator for all of us).

It's boring when our portfolios are too well-balance, there's not much to do during the day…

Short-Term Portfolio (STP) Review:  The last time we checked in on the STP was way back on June 4th, when the S&P was at 3,122 in the morning, as I wrote our report.  At the time it was at $527,965 and we decided to make some aggressive adjustments to lock in some silly gains in the LTP, which had hit $855,428 as of the previous day's close.   We've been on a road to nowhere since and now the STP is at $521,587 – very little has changed for the STP in the past two weeks and that's good – because hopefully the LTP is doing it's job and making money on short puts and calls we sold, even in a flat market.

Advill thinks I might have political bias but, if I didn't tell you how I felt, you wouldn't be able to judge for yourselves and clearly, most analysts DON'T tell you how they feel about such things for fear of losing readers.  So, if you prefer to have your analysts lie to you and pretend they are neutral, politically and have no views on the World – there are thousands of them happy to lie to you and take your money.

If you want to understand an analyst and how he forms his opinions so you can weigh that and make intelligent decisions of your own.  Well, there's me and……   hmmm…..

Anyway, Trump sucks again and these Bolton revelations are horrifying and I think that's a reason to be extra-cautious over the weekend, in addition to 10,000 more people will be infected in Florida by Monday and 100,000 more in the US, etc.  That's my premise, these are the trade ideas:

  • CANE – Went ripping higher last week and I feel good about the bottom call we made.

  • SDS – These are the short calls left over from the old spread.  We sold them for $38,000 and they are up $24,250 (63%) in two months, so that's nice but, more importantly, the net of the $15/30 spread was $95,900 so we just paid for 25% of that!  SDS is a 2x ETF and the S&P would have to drop 50% to get to $40, so those are pretty safe but a long time to wait for $13,750 so let's clear margin (we don't need but good for people who do) and buy them back.  The July $20s are $1 and we have 100 more longs than shorts so why not sell 100 July $20s for $10,000 as they will decay nice and fast (29 days to expiration) and then we'll see how the weekend goes.  

  • SQQQ – Also a leftover leg but will expire worthless.  I'll do the rest later.
  • AAPL – Wow, good for a new trade I'd say as the net is $154.72 – less than 50% of where they are now.  Not very margin-efficient though.  
  • JPM – More free money for those of us wealthy enough to promise to buy a stock at a ridiculously low price and then not have to buy it at all and still make $73.8% 3 months later.  It's good to be the king!  

  • TQQQ – This was more for fun than anything as I wanted to see if it would outperform SQQQ and look – it has!  More money on a 3x ETF means more room for decay and, even though we're out of the money, the combo is still working.  Up $14,875 on our net $50,500 entry (no margin required) is 29.4% in just over a month.  Very good to be the king…

  • CMG – Are you freakin' kidding me with $1,029?  WTF people?  Who is buying this?  Oh well, we're ahead and shouldn't complain but this is idiotic.  Why are we ahead when our premise is that CMG will be below $950 in 2022 and it's $75 over that now?  Because we are BEING the House and selling the short-term puts and calls and they are doing the heavy lifting.  Now I want to take our $30,000 in profits (so far) and buy back the short puts for $12,760 and then we'll wait for the next dip to sell more.  The short June puts will expire worthless but also I'd rather wait for a dip to sell more.  We stand to collect another $6,650 on the short July calls anyway.  

  • SQQQ – The meat and potatoes hedge.  Jna $5s are $3 in the money and we paid net $2.75 for them so can't complain, can we?  It's a 3x ETF so 20% drop in the Qs (well-deserved) would be 60% pop to $12.80 and our short calls are $15 so they are never going to get paid.  Short puts are in the money but they can be rolled so no worries.  

  • TSLA – Wrong on both ends so far.  TSLA fell 60% in the last crash – I want to be there when it happens next so we roll the 3 Jan $850 puts at $124 to the $950 puts at $174 for net $50 on the $100 roll up and we'll sell 2 more for good luck since it's a good hedge that would pay $350 at $600 for about a $100,000 profit on the set – that's our new hedge for the week then.

  • UNG – It's a hedge on our hedges, something that will make money in a bullish market.  Not so far but may as well do the right thing and buy 50 more 2022 $8 calls for $3.70 - just in case there's a hurricane that shuts more production than the production that's being shut now due to low demand for oil (sometimes same wells).  

Long-Term Portfolio (LTP) Review: Other than our 5 new trade ideas for the month, we didn't touch the LTP but it flew up from $599,510 to $883,615 – a massive $284,105 (47%) gain in 30 days!  Now you KNOW that's not supposed to happen but it was a huge surge in the S&P and the Nasdaq and we had positioned ourselves very bullishly as we had a lot of hedges to protect us if we were wrong.  As I said in the last review: "What a fantastic bunch of positions these are!  We still have tons of cash and we're well-hedged so I'm very excited about this portfolio going forward."   

Still, these gains are silly and yes, we picked the stocks we thought would benefit most from re-opening, even though I thought the re-opening was going to be a disaster – which it is shaping up to be.  If you can gain 47% in a month then you can lose 47% in a month so we're going to take a sharp knife to these positions and cut, Cut, CUT anything we think might be impacted if we go back on lockdown due to rampaging virus, again.  

Short Puts – We're certainly going to take ones that are up over 60% off the table so here's a list of those and the rest we keep (unless we have a particular worry).  Most of these will go right back on our Watch List.

  • AAPL – Though it's a silly price, AAPL is still toppy at $350 in a global recession and we have to wait 2 years to make the last 33% – not worth even a tiny risk.  That goes for both puts.  If AAPL goes lower – we'll be the first ones selling puts again.
  • CLX – Again, though I have no worries, why wait 18 months to make $2,150 (26.5%)?  We can do better with our cash and margin. 
  • ET – I don't love them
  • HBI – Weak consumer.  

  • LMT – It's our Stock of the Decade but the decade is just starting and we're already up 72.5%, not worth waiting 18 months for the other 27.5%.
  • MDT – Wow, I'm selling all my favorites – I must be worried.
  • MTN – Simply went up far too fast to not cash in.  I love Vail, I wish we had a bigger position so back to the Watch List.  

  • STZ – Such a ridiculous price for the put that it's almost good for a new trade so we're KEEPING it – despite being up more than 50% in two months.
  • XOM – Oil back to $40 is good for the king but that's enough of that nonsense.  

  • PAA – It's interesting that it shows a loss since our net entry is only $10.38 and we sold the $8 puts and $5 calls (on 1/2) so our net entry is $7.05 and 1/2 will be called away at $5 leaving us in 4,000 at about $9 so all the losses are simply premium that WILL burn off so this position is well-protected and has $18,000 coming to it in premium burn alone.

  • AVGO – I think they can withstand the storm.  Only $64,000 on a $140,000 spread that's in the money so I guess it's worth holding, right?  
  • BRK.B – If they fall apart, we're all doomed!  
  • CMCSA – They are sports heavy so we're going to kill them.  Back to the Watch List!  

  • CSCO – All these shut-ins need their internet (though that was a strength of Comcast too). 
  • FL – Brand new and already popping.  Even infected zombies need sneakers.
  • GILD – Not worried.
  • GM – Going to be rough but only net $15,000 out of $35,000 so let's stick it out.
  • HMY – Still has that new trade smell.   Gold plays are good hedges – that's why we added them.

  • IMAX – They are back but it might have been too soon to jump back in though Asia seems to have the virus more under control than we do and that's half their Box Office so I'll give it until earnings, which is early Aug.
  • LABU – We're very deep in the money but only net $22,000 out of potential $40,000 so good for a new trade, actually.

  • M – Too much of a bargain to sell while it's profitable.  
  • MIDD – I could have sworn we killed this already?  Ah, I just checked and I said "  I don't think a lot of restaurants will be buying new ovens this year though so I won't be too patient if this one starts to falter."  Hmm, tough call but it's just hitting technical resistance on the downtrend and it's potential $40,000 and currently net $14,000 (not the Dec $100s) so I guess we'll give them a chance. 

  • MO – $75,000 spread at net $33,000 has too much room to grow and you know what people will do for a cigarette…
  • RH – Pretty new and I love them at net $53,000 out of $80,000.  So deep in the money we may as well wait as it's 50% up from here so worth waiting for.
  • SKT – Showing signs of life.  As long as they hold that $7.50 line I'm good.  

  • SPG – Another mall REIT!  In good shape already, added just before our last review.  
  • SPWR – This is in every portfolio so a big keeper.
  • TXT – Room to run at net $28,000 on the $68,000 spread so we can keep this. 

  • VIAC – $23,000 on the $50,000 spread has 100% to go and it's in the money and I love them.  See how easy that is.  
  • VLO – Net $10,000 out of $20,000 is a keeper.
  • WBA – Uncovered.  Nope, have to be aggressive on these guys.   Earnings July 9th and I say back over $45 by then.

Well, we didn't get to kill too many longs because our positions are SO GOOD!!!  Still, we took some off the table and we killed some puts and overall we reduced our downside exposure considerably and raised our buying power and that makes our STP hedges much more powerful (because they are protecting less) so all in all – it's a good set of adjustments.  

 

 

IN PROGRESS

 

 


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  1. Good Morning.


  2. @Pharmboy — ARNA

    Pharm — I followed you in the ARNA butterfly play (never did one so I took a small chance).  Mine got filled at 0.77 and I since rolled down from the 65 calls to the 60 for $2.50 when it dipped last week.  So now my basis is $3.02 on the 60/70/75 'broken wing' butterfly  — I also read up on butterfly spreads to educate myself and figured the roll was a good idea.  Are you still confident in the $70 target?


  3. Good morning! 

    China giving us another up day, running in to save Trump by promising to buy farm goods, which is exactly what Bolton accused them of colluding on so interesting move – maybe China thinks it will drive the point home, knowing Trump is in no position to refuse – even if it reminds people it's just a ploy to get re-elected?  

    Over 3,135 now so we'll see if it holds – good shorting line on /ES, of course.  Lines up with 26,200 on /YM, which is an old favoriet and 10,100 on /NQ and 1,450 on /RTY.

    Oops, so much for /RTY… They've been the leading indicator so let's keep an eye on them.

    32.50 is NOT a VIX that isn't worried.


  4. Phil / CSCO – is this in or out?


  5. Not out unless saying so in blue.


  6. SPWR

    SAN JOSE, Calif., June 16, 2020 /PRNewswire/ — SunPower Corp. (NASDAQ:SPWR) today announced that it anticipates closing the planned spin-off of Maxeon Solar Technologies during the third quarter 2020. The company also reiterated its second quarter 2020 guidance due to continued improvements in its U.S. and international Distributed Generation (DG) business.

    SunPower Logo. (PRNewsFoto/SunPower Corp.)


  7. people start early voting in 91 days. It's really here, it's really coming.


  8. people start early voting in 91 days. It's really here, it's really coming.



  9. Apple says they are going to close some stores again, and there goes the market.  Let me guess, Arizona, Texas, Florida , ?? lots more to choose from 


  10. Not Texas, but the Carolina's as well…


  11. 1020 – so excited, apparently I had to say it twice! 

    This market is not looking healthy. 10 x July 17th 195 puts for 0.55


  12. this map shows recent COVID data quite well


  13. Wow, that was a fast fade.  Very nice for the index shorts!   As we expected, re-opening without being properly prepared is leading to more infections.  

    Stopped out now. 

    SPWR/DC – I knew they'd never get it done in Q2.  Popping 3% on the news.

    OMG – What idiots! 


  14. Phil/PFE

    GOOD MORNING!

    Time to set up a 2022 $33/38 call spread on PFE? Unless their pipeline thesis has changed, it looks about the bottom of a long term range here.

    they don't have exciting anti Covid therapies, but should do well regardless


  15. The Bug – this is the big flaw – the lockdown doesn't stop the outbreak; it just kicks the can down the road. Same with all the talk about how tests will save us. Not without modern contact tracing it won't. The incompetence at all levels is astounding.


  16. Phil / SPWR – I must be missing something big here.    I reviewed this a while back  trying to understand where the value was  and was struggling with the business model and how they could make money…. The business model was flawed, they started out as a tech company and moved into supply chain / mfg, and direct sales. – Now, the company is spinning off into two companies - Sun- Power and Maxeon Solar Technologies .  Sunpower will own 71% of new Maxeon.  SunPower will operate in the North America market and Maxeon will manufacture solar panels in asia – and sell in Asia.

    Maxeon a joint venture with a Chinese Company (TZS -Tianjin Zhonghuan Semiconductor, TZS )   will be headquartered in Singapore and will be manufacturing focused and provide product in Asia ( not sure if rest of world is in here or not).  SunPower a trimmed down version  will own the IP, and focus on a more capital light business model.  In the 10 years since going public they have  made money 3 years ’10, ’13, ’14 with a break even in ’19 ( in which finances were being ‘window dressed’ for the split).    Really the more they expanded into doing their manufacturing and sales the more money they lost.  They struggled with the amount of capital required to run the business, and were weak operationally – Manufacturing and supply chain.  There is surprisingly not a lot of details on the split financially.  The current CEO will run SPWR and a new CEO who joined the a year ago will run the new company.   Maxeon will take on the majority of the company debt, and they will share some revolving credit.

     

    From a technology standpoint their product is among the most efficient in the industry five best solar panel manufacturers in 2019 ranked based on the highest efficiency solar panel they have to offer:

    SunPower (22.8%)

    LG (21.7%)

    REC Solar (21.7%)

    CSUN (21.2%)

    Solaria (20.5%)

     

    Given how the company is being split I am focusing on the new sunpower not maxion going forward.  Key question is can they expand the GM going forward.   SPWR’s Gross Profit has gone from 20% in ’14 to 6% in ’19.  So how much of the OPEX was being eaten up by MFG, and can the new MFG footprint in US coupled with outsourcing improve this?  Will they be able to lower their costs by going to an ousourced sales model without impacting revenue gains?  The Net is will they be able to achieve at least a 10 – 15% GM, and grow the Rev at a 10 to 15 % rate?  Can maxeon deliver any growth and grow it’s value so that new SPWR can get some gains out of it?

     

    Over the next 12 to 18 month I see challenges. They had outlooked ’20 for a GM of 9% to 12% , and going forwad at 10 to 15 percent.   Now ’20 may have a GM of 4 to 6% ( my estimate) and ’21 might be in the 6 to 8 percent. In addition, Nat Gas and oil will be depressed for at least 12 to 18 months this will be a damper on demand as projects may get delayed.   Part of the business model is to get into leasing and financing to grow the business.  They have not provided any details on this.  

     

     I’m struggling with this one, as I want to see what I am missing.  Can you please provide more details as to why this is a buy, and  you believe the right price target ? along with what metric is used to value it?

     

    Thanks for your help on this!


  17.  

    AAPL – this is very concerning. AAPL was one of the first companies to close it's offices in Norther CA… they were also one of the first to limit travel ( along with Amazon and Google) 

    Very concerning….  don't say for how long so this Ould be the beginning of other stories closing…

     

    The company confirmed the move to Yahoo Finance via an emailed statement saying that the company is closing its retail stores beginning June 20 out of an abundance of caution.

    The stores to be closed are in Arizona, Florida, North Carolina, and South Carolina, four states that are seeing the highest seven-day average of new coronavirus infections since the pandemic took root in the U.S.


  18. PFE/Maya – Sure I like them down here.  The 2022 $30 puts are $3.75 so that's a good start (selling them) and maybe pick up the 2022 $28 ($8.85)/35 ($3.00) bull call spread for $5.85 so net $2.10 on the $7 spread is a nice way to play.

    Incompetence/Snow – You said it.  I don't think this can be controlled now – not without emergency lockdowns for the red states (and the parts of CA that are red are what's causing their spike).  That would have to be imposed from the top and that's not going to happen so – DOOM!

    Maxeon/Batman – That's how SPWR is getting ride of their debt.  CZR does it every other year!  Those obligations are, in theory, holding them back so getting rid of them could help them get traction faster.   

    Notice how tight the next 3 are and SPWR leaps 5% ahead – that is a big deal and I think they believe they are getting close to 25%, which is a game-changer.  I was worried people would put off solar projects but that's not happening on scale projects and it's still a big infrastructure plan around the World.  Anyway, we can discuss more on the weekend – I'm trying to finish portfolios.

    AAPL is smart, other companies just slow to react and putting employees in danger.  Restaurant I was in last night (because the one we reserved suddenly closed for good) the waiters were not even wearing masks and the guy kept coming way too close to us and no gloves serving our food – I won't be back there!  Florida is completely crazy!  


  19. Phil:  I just realized that the really excellent news feed that you have traditionally featured in chat has been missing for a while now.  Is this a permanent change or is it due to a technical issue that will be resolved?  I've always found the feed to be very useful and full of perspectives and news that I might have missed otherwise, so for what it is worth, I am hoping that the feed will be reinstated.  Thanks.


  20. CA/Phil – the spike is in the Central Valley. Lot of poverty, farmhands living in rough conditions, a lot of people inclined to sneer at public health orders. Devin Nunes country.


  21. News/John – No, we had a bit of trouble and it should be better now but now I'm going over the portfolios and the news is depressing me anyway.  Back to normal next week I think.

    CA/Snow – Yep, disaster area and now Trump is holding a rally that every single health official thinks is a bad idea. 


  22. Phil / TSLA hedge

    Could you please explain how the new TSLA hedge works?


  23. Tomorrow I can!


  24. Butterfly Portfolio Review:    $395,234 is down $48,020 since our last review but not so bad considering how burned we got on AAPL and AMZN short calls.  Now we have to make adjustments and, if we ever re-capture those funds – things will turn back very quickly.  These ups and downs are normal in the Butterfly Portfolio as it's subject to short-term swings but, over the long run, the premium-selling game is a very consistent winner.  

    • AAPL – Well our 2022 spread is deep in the money and good for $180,000 but only showing net $108,000 so $72,000 more to gain on that as time goes on.  Meanwhile, we sold the July $300 calls and those are down $37,000 but that's fine as they are protecting our gains as we wait for the next $80,000 to kick in.  Still AAPL is toppy so it's silly not to take advantage so we're going to close the short 2022 $200 puts with a 72% profit and sell 10 Sept $350 calls for $22.50 ($22,500) and roll the 10 short July $300 calls at $50.25 to 10 short Aug $330 calls at $30 – so we're not spending more but we are selling net 10 more short calls that have more premium to burn.

    • AMZN – Here we have another $180,000 spread at net $134,000 so we have $46,000 left to gain but the short calls are killing us.  We can roll the 4 short June $2,300 calls at $372.50 ($149,000) to 4 short Sept $2,600 calls at $220 ($88,000) and we'll be thrilled if those go worthless as we collected $68,000 to start so we're rolling the loss in this case.  We are so deep in the money on the call spread, we're not worried about that downside at the moment.

    • DIS – Right on track.
    • KO – Brand new and great for a new entry.

    • MDLZ – The short puts will expire worthless and we only have a half-cover so we can now sell 15 2022 $55 calls for $5 ($7,500) and sell 10 Aug $50 puts for $1.45 ($1,450).

    • MJ – A bit ahead on the July calls but no hurry to roll a 1/2 cover. 
    • WHR – The short June calls will expire worthless and the Sept calls are protecting our profits so we are all good on that one.  


  25. Dividend Portfolio Review:  $177,264 is up $35,204 since our last review so a nice recovery in the out-of-favor dividend sector.  We'll see if we want to keep these but they are generally good stocks that have simply suspended dividends (some of them) and gotten oversold because of it.

    • PFE – Up 50% in 3 months – that's why I love making entries that way.  Not worried about owning them at net $22.50, right?
    • ET – We are miles above our target.  
    • MO – I think they are breaking up but not enough to buy back the short calls.

    • SPG – On track with a great profit already.
    • TWO – On track, fairly new.

    • CHL – Should be as fine as T.  June $37.50 calls are expiring worthless so let's sell 5 Sept $35 calls for $1.80 ($900) as the stock is at $35 and that's good premium. 

    • F – Waiting for earnings.
    • M – Keep in mind we sold the $5 puts so our only issue is the short $13 puts but that's a next year problem.  
    • SIG – They were doing great but then they collapsed.  We missed a chance to sell short calls that we certainly should have taken.  Now we'll see if the bottom of the channel holds.

    • SKT – Hopefully breaks upward soon.
    • T – If the portfolio wasn't down, I'd double down at $30!  

  26. Earnings Portfolio Review:  $189,087 is down $3,578 from the last review, as it should be because this is a self-hedging portfolio (doesn't use the STP) and we played things very cautiously last month.  

    • SDS – Those will expire worthless and we are done with that hedge very profitably.
    • ACB – Doing great now – finally!  

    • HBI – I still like them.
    • HRB – I expect to get the short put money back but the long calls seem worthless and I don't want to put more money in.

    • IRBT – Let's roll the 4 short July $65 calls at $18 ($7,200) to 6 short Sept $80 calls at $12 ($7,200) and that's very easy to fix while protecting our spread.  

    • M – Was $10 just a week ago!  
    • SQQQ – We're obviously very well-balanced so let's not rock the boat.  

  27. HMMM not able to post


  28. None of your comments in the spam folder Batman.  Did you ignore yourself?  That happens.  

    If anyone is having trouble like that, please let Greg (at Philstockworld) know.


  29. As fears of a second wave of Covid-19 weigh on stocks, here’s some potentially good news: A vaccine may be approved before the November election, according to a major biotechnology investing research firm.  The prediction is a big deal for investors for three reasons.  1. It’s credible because it comes from Jefferies, a high-profile brokerage in biotech and pharma that’s wired in to literally hundreds of companies in the group, including the major vaccine developers. Jefferies has nine analysts covering the industry.  2. Food and Drug Administration (FDA) approval of a vaccine ahead of voting could have an impact on the elections, possibly swaying the outcome in favor of President Trump.    3. For investors, early vaccine approval would be bullish for biotech stocks, cyclical stocks, travel stocks, the economy and the market overall. The S&P 500 Index SPX, -0.16% and the Dow Jones Industrial Average DJIA, -0.28% have recovered most of their March losses, and the Nasdaq Composite Index COMP, 0.14% recently hit new highs. They’ll need some good news to support further advances.  Ironically, early vaccine approvals probably won’t mean much for investors who have already enjoyed good runs in vaccine developers. It might not mean much for most people worried about contracting the virus, either. Weird, right?


  30. Phil / commnets – do did not ignore myself 

    As fears of a second wave of Covid-19 weigh on stocks, here’s some potentially good news: A vaccine may be approved before the November election, according to a major biotechnology investing research firm. 

    The prediction is a big deal for investors for three reasons. 

    1. It’s credible because it comes from Jefferies, a high-profile brokerage in biotech and pharma that’s wired in to literally hundreds of companies in the group, including the major vaccine developers. Jefferies has nine analysts covering the industry. 

    2. Food and Drug Administration (FDA) approval of a vaccine ahead of voting could have an impact on the elections, possibly swaying the outcome in favor of President Trump. 

     

    3. For investors, early vaccine approval would be bullish for biotech stocks, cyclical stocks, travel stocks, the economy and the market overall. The S&P 500 Index SPX, -0.16% and the Dow Jones Industrial Average DJIA, -0.28% have recovered most of their March losses, and the Nasdaq Composite Index COMP, 0.14% recently hit new highs. They’ll need some good news to support further advances. 

    Ironically, early vaccine approvals probably won’t mean much for investors who have already enjoyed good runs in vaccine developers. It might not mean much for most people worried about contracting the virus, either. Weird, right?


  31. Phil – nope – can't post — have tried posting just the link,  a copy of article ( which I've been able to do before) — can only post typed in comment.  nothing else


  32. Phil/LABU

    I had a calendar spread of long 35 (Jan 21) / short 35 (19th June – Today) . The short 35 got exercised and my account is showing negative position of -700 shares of LABU. What options do I have? I can sell the long calls and then use that money to buy back the short position.

    thanks as always

    regards


  33. Future Is Now Portfolio Review:  I am punting as it's up 20% from last review and we'll do more on weekend.

    2 SPWRs!

    Hemp Boca we shouldn't have closed (but it's redundant):

    Wow, and that's it.  Got them under the wire (as usual).

    You guys have no idea how exhausting that is for me – so much research to say so little.  

    Comment/Batman – Now it's spam!  At least I was able to get it.  Must be something very spammy about the links.  


  34. Batman – I think I got you all fixed up. (And the posts/links should be showing up.)


  35. WBA trading like a tech stock


  36. Yucky finish – as we expected though.

    Batman – You know your post is above, right?

    WBA/Kustomz – It should be from that low base.  

    LABU/Pat – That was bound to happen when you left them to the last minute.  Notice you also have the $35 in cash and LABU is at $53 and your Jan $35 longs are at $25.50 so you have $78.50 to purchase LABU for $55 which means you are getting $23.50 back on your spread.  Of course you can keep the longs and sell more short calls.

    Have a great weekend everyone, 

    - Phil


  37. Ed, a few days ago you asked for my wife to contact you regarding solar.  She shot you an email but never got a response.  Maybe there's an issue with the email address?  Anyway, her contact is debie{at}RLRoofing{dot}com.  Feel free to reach out.  She still keeps an eye on her work emails.
     


  38. Phil.  Post.  See it now.   I know your tired.  But can you take a look at my post on spwr above?

    Phil. / spur.  

    Would really like a response on this.  I feel llike I’m missing an opportunity in this but need more data from you   Thanks 


  39. Happy Fathers Day to all the Good Dads!  :)


  40. Happy Father's Day everyone.  Just had a nice dinner with Mom and the kids (virtually).  So nice to get some family time…

    Indexes opened low but are picking back up.  

    SPWR/Batman – I have done these numbers before but, again:

    Year End 29th Dec 2014 2015 2016 2017 2018 2019 TTM 2020E 2021E CAGR / Avg
    Total Revenue
    $m

    3,027 1,576 2,553 1,794 1,726 1,864 1,965 1,895 2,185 -9.24%
    Operating Profit
    $m

    251 -206 -372 -1,025 -849 -98.1 -26.0      
    Net Profit
    $m

    246 -187 -449 -929 -811 22.2 110 -67.9 39.0 -38.2%
    EPS Reported
    $

    1.55 -1.39 -3.25 -4.49 -5.76 0.150 0.649     -37.3%
    EPS Normalised
    $

    1.62 -1.36 -2.57 -1.48 -3.15 -0.181 0.370 -0.522 0.064  
    EPS Growth
    %

    +131                  
    PE Ratio
    x

                19.7   114  
    PEG

    So what are we paying for this mess?   $1.24Bn at $7.28 and they are around $2Bn in sales with no profits with distressed debt – hence the need to roll debt to spin-off so healthier main company can borrow to expand.  

    You have to look at them like a start-up who have sunk about $3Bn into R&D in the past 5 years and it's finally starting to pay off as they have the most efficient cells – even without cheating (like FSLR, who uses very rare tellurium).

    And what do they need to do?  They need to make $100M to justify that market cap and $100M is 5% of $2Bn in sales so that seems obtainable, right?  Not only that, but they have $3Bn in tax losses to work off so many years of untaxed earnings ahead.

    SPWR lost 0.10 in Q1 but that was 0.10 better than expected and Revenues were way up at $454M, well on track to hit $2Bn and up from $348M in Q1 last year and margin doubled from 6% to 12%.

    "Looking forward, we remain very confident in the significant longer term growth opportunity in solar and our investment priorities are consistent with this potential. These investments include our next generation Maxeon technology, Equinox and Helix storage solutions and our digital initiatives. We have also instituted a number of programs that we expect to result in cost and cash savings of up to $100 million in 2020. Finally, we expect to complete our planned company split into two, independently focused, pure-play solar companies by the end of the second quarter pending closing conditions. With further investment in our industry-leading technology and initiatives in place to strengthen our balance sheet, we remain focused on emerging from the current disruption in a much stronger competitive position."  

    As previously announced, the company continues to assess the impact of the COVID-19 crisis on its fiscal year 2020 forecasts. As a result, the company will not be providing fiscal year 2020 guidance at this time.   

    The company's second quarter 2020 GAAP and non-GAAP guidance is as follows: on a GAAP basis, revenue of $290 million to $330 million, gross margin of negative 9 percent to negative 3 percent and net loss of $120 million to $100 million. On a non-GAAP basis, the company expects revenue of $290 million to $330 million, gross margin of 0 percent to 6 percent and megawatt (MW) deployed in the range of 340 MW to 400 MW. The company also expects break even to slightly positive cash generation in the second quarter.

    The company expects second quarter 2020 Adjusted EBITDA guidance in the range of negative $40 million to negative $20 million with SPT in the range of negative $25 to $15 million and SPES in the range of negative $10 to $0 million. 

     It's essentially a growth company hitting a no-growth period for no fault of their own so it's very easy for people to bail out and hard for people to jump in and give them a chance to get over this hump.  

    You know which I favor.


  41. Phil / SPWR – thanks for taking another look at this one I see your thought process and the numbers help me…….

    I've been through earnings reports  / annual and Q's – I'm looking at a loss this year at about .5 to .6 /SH and next year '21 -.1 to .05 / sh…  so that would get earnings  to about 10M fo that year best case…  and the spin off is pushed to Q3 of this year so maybe '22 after a full year of new co they are projecting 1B ish Rev and then drop down maybe 6 to 12 percent and I can squint at 100M. two years out…  then 10 to 12 / price per share maybe 15…..  

    So I sold puts a while back at 20X  '22 $ put ( 2.5) I'm looking for a spread to start layering into this one…. what do you think of the following?          below is less than a fifth of a position.

    Long 50X Jan '22 5 Calls ( 3.9) 

    Short 50X Jan '22 12 Calls ( 1.5) 

    And  maybe add to the shorts to end up with 30X 'jan '22 $8 Puts ( 2.75)   Kinda feels like I should look at some short term short callers?     

    Thanks for your help on setting up the spread


  42. Phil – Happy Father's Day !!!!


  43. Good morning!

    SPWR/Batman – Nothing wrong with that spread at $2.40 but the $3/8 spread is $2.50 and much more likely to be in the money so I'd rather have those and sell 20 (of 50) Aug $8 calls for 0.85 ($1,700) to lower the basis to $2.16 using 60 out of 578 days.  If SPWR is flat or down, you lower your basis and do it again until you have a free trade – if SPWR goes up, you roll and DD your longs if you have to – you were going to scale in anyway.  


  44. Good Morning!

    Phi / TQQQ

    I listened to your answer on hedging as to why you prefer TQQQ. 

    What do you think of this trade?

    Buy 50 Jan 90 Puts @ 20.65
    Sell 50 Jan 65 Puts @ 10.77
    Sell 50 Jan 130 Calls @ 8.57

    Net $6,550 for $125,000 hedge. 

    What can go wrong? What are the chances TQQQ hitting 130 before Nasdaq goes down 10%? 


  45. Good morning!

    My bad, I thought I hit publish earlier.  Totally had this mostly written before 8:30 and just finished the end.

    On to the new post, please.