Posts Tagged ‘BBY’

Bears Bulk Up On Best Buy Puts Ahead Of Earnings

Options volume on Best Buy is almost three times the average daily reading for the stock today, with more than 20,000 contracts traded on the consumer electronics retailer versus average daily volume of around 7,600 contracts. Shares in Best Buy are suffering this afternoon, down more than 5.0% at $24.66 as of 2:15 p.m. ET on a down day for U.S. stocks. Much of the options action in BBY today is in puts on the name, with the put/call ratio hovering near 3.1 as of the time of this writing.

Near-term bearish positioning in Best Buy options suggests some traders may be looking for the price of the underlying to extend losses, perhaps leading up to and following the retailer’s first-quarter earnings report on May 22nd. The 23May’14 24.0 strike puts traded upwards of 3,300 times so far today, with much of the activity occurring in the first hour of the session. Time and sales data suggests most of the 24.0 puts were purchased at an average premium of $0.41 each. Traders long the contracts may profit at expiration in the event that Best Buy shares drop 4.0% from the current level to trade below the average breakeven price of $23.59.

Also active this morning were the Jun 20.0 strike puts, which traded more than 3,000 times, albeit against sizable open interest of 7,131 contracts. The 20.0 strike put options appear to have been purchased at a premium of $0.12 each. These far out-of-the-money put options may be profitable at expiration next month if shares in BBY drop nearly 20% to $19.88, the lowest level since March 2013.


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Best Buy Co. Calls In Focus

BBY – Best Buy Co., Inc. – Weekly options changing hands on Best Buy this morning suggest some traders are looking for shares in the consumer electronics retailer to continue higher during the next few trading sessions. Shares in BBY, up better than 200% since this time last year, are trading 2.0% higher on the day at $41.36 as of midday in New York trading.

Fresh interest in upside call options expiring at the end of this week are active today, with the Dec 06 ’13 $42 strike options attracting the most volume. Around 1,900 of the $42 weekly calls have traded thus far in the session against open interest of 161 contracts. One strategist appears to have purchased around half of the volume at a premium of $0.56 each just before 11:00 a.m. EST this morning. The calls make money at expiration if shares in BBY rally another 2.9% over the current price of $41.36 to exceed the breakeven point at $42.56. Traders are also homing in on the Dec 06 ’13 $43.5 and $44 strike calls, with around 430 and 750 contracts exchanged thus far in the session, respectively. 

GM – General Motors Co – Shares in GM are on the rise today, up 1.0% at $39.15 as of 11:20 a.m. EST, after earlier rallying 1.7% to touch a new 52-week high of $39.39. Trading in the regular December options on the automaker this morning suggest one strategist is positioning for shares in the name to extend gains during the next few weeks.

It looks like one trader initiated a one-by-two ratio call spread on the stock, a strategy that looks for limited gains in the price of the underlying through December expiration. The trader appears to have purchased 920 calls at the Dec $39 strike at a premium of $1.10 each and sold twice as many of the Dec $41 strike calls at an average premium of $0.345 apiece. The net cost of the ratio spread amounts to $0.41 per contract and positions the strategist to profit in the event that GM’s shares exceed the breakeven price of $39.41. Maximum potential profits of $1.59 per contract are available on the spread if shares in the automaker rise 4.1% to settle at $41.00 at expiration later this month. Shares in GM are up more than 50% since this time last year. 


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BBY Options Active Ahead Of Q3 Earnings

BBY – Best Buy, Inc. – Shares in Best Buy have slipped into negative territory in the final hour of trading on Monday, with the stock down 0.20% at $43.62 as of 3:20 p.m. EST, ahead of the electronics retailer’s third-quarter earnings report prior to the opening bell tomorrow.

Nov 22 ’13 expiry options are active ahead of the quarterly earnings release, with interest rising in both call and put options. One strategist appears to be taking the view that shares in the name will rally to fresh 52-week highs this week, buying a 1,000-lot Nov 22 ’13 $44/$48 call spread at a net premium of $1.23 per contract. The spread makes money if shares in Best Buy rally 3.7% over the current price to exceed the breakeven point at $45.23. Maximum potential profits of $2.77 per contract are available on the bull call spread in the event that BBY shares surge 10% to $48.00 by expiration this week. BBY shares are up roughly 200% since this time last year.  

Overall options volume on Best Buy is approaching 35,000 contracts in the final 30 minutes of trading, which is roughly 165% of the stock’s average daily volume of around 20,700 contracts. Puts are trading more heavily than calls, with the put/call ratio up above 1.2 as of the time of this writing. 

TWTR – Twitter, Inc. – Shares in Twitter are on the decline today, slipping 2.8% to $42.73 during the first half of the session after the stock was rated new ‘Sell’ with a 12-month target share price of $34.00 at Wunderlich Securities. Options on Twitter, which began trading on Friday, are active today, with volume nearing…
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Best Buy Options Active Ahead Of Earnings

Today’s tickers: BBY, INTC & SUPN

BBY - Best Buy Co., Inc. – Options on Best Buy are active this morning ahead of the consumer electronics retailer’s second-quarter earnings report prior to the opening bell on Tuesday morning. Shares in BBY are rising ahead of earnings, up 1.75% at $30.90 as of 11:40 a.m. ET. Weekly call and put options are the most actively traded contracts by volume as of the time of this writing, with more puts changing hands than calls and the put/call ratio hovering around 2.75. Much of the trades initiated this morning appear to be near-term bullish on BBY, with put sellers stepping in as well as upside call buyers. It looks like more than 2,000 of the Aug 23 ’13 $28.5 strike puts were sold in the early going for a premium of $0.55 apiece, while roughly 2,000 of the Aug 23 ’13 $29 puts were sold at a premium of $0.70 each. Put sellers keep the premium received on the trades as long as shares in Best Buy settle above the $28.5 and $29 striking prices at expiration this week. The positions start to lose money, however, in the event that BBY shares decline nearly 10% from the current price to trade below effective breakeven points at $27.95 and $28.30, respectively, at expiration. Finally, options traders exchanged more than 2,400 of the Aug 23 ’13 $31 strike calls versus open interest of 152 contracts. Time and sales data suggests much of the volume was purchased for an average premium of $1.20 apiece, thus positioning buyers of the calls to profit should shares in Best Buy rally 4.2% over the current price of $30.90 to exceed an average breakeven point and new 52-week high of $32.20.

INTC - Intel Corporation – Shares in Intel are up the…
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Best Buy Bulls Bulk Up On Weekly Calls As Stock Hits Highest Since July ’11

Today’s tickers: BBY, GMCR & EBAY

BBY - Best Buy, Inc. – Shares in Best Buy are soaring on Monday, up as much as 7.7% during morning trading to hit $29.44, the highest level since July of 2011, after the stock was resumed at ‘Outperform’ with an increased target price of $40.00 from $32.00 at Credit Suisse today. Trading traffic in weekly options on the consumer electronics retailer suggest some strategists are positioning for shares in the name to extend gains during the shortened U.S. trading week. The most actively traded weekly contracts by volume this morning are the Jul 05 ’13 $29 strike calls, with upwards of 1,300 lots in play versus open interest of 75 contracts. Bullish traders appear to have purchased most of the contracts for an average premium of $0.37 apiece and may profit at expiration should Best Buy’s shares exceed the average breakeven price of $29.37. Upside calls at the Jul 19 ’13 $30 strike are also active today, with around 630 lots purchased during morning trading at an average premium of $0.54 each. The contracts make money if shares in Best Buy rise another 3.7% to top $30.54 during the next few weeks to expiration. Shares in BBY are up more than 140% since the start of 2013.

GMCR - Green Mountain Coffee Roasters, Inc. – A sizable trade in January 2014 expiry put options on Green Mountain Coffee Roasters initiated within the first 40 minutes of the opening bell this morning suggests one trader may be bracing for a pullback in shares of the coffee producer, with the stock up more than 250% since this time last year. Shares in GMCR today are up 3.3% at $77.72 as of 12:25 p.m. in New York. It looks like one trader purchased 5,000 puts at the Jan 2014 $60 striking price for a premium of $5.35 per contract. The position starts making money in the event that shares in Green Mountain plunge 30% from the current price of $77.72 to breach the effective breakeven…
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Thrilling Thursday – Romney and the Markets Turn Up

What a debate last night!

One of the candidates will lower taxes for the middle class and small businesses while slamming shut loopholes on the rich and Big Business, limiting their deductions and raising taxes if needed, he will provide national health-care and concentrate on jobs, punishing outsourcers and educating US workers to get them on the path to full employment.  The other candidate is already President.  Romney now claims there will be no 20% tax cut for the rich – I assume his rich backers assume he's lying to get elected (lying doesn't bother them) and President Obama was in no way prepared to debate the guy who showed up yesterday and he lost the debate in an embarrassing fashion.  

From a market perspective, we were playing the weakness as nervousness ahead of the debates and accumulating long positions as planned yesterday.  Oil blew past the $88.50 target I set in yesterday's morning post – all the way to $87.70 before finally bouncing back and hitting our target again overnight (now $88.64).  That drop from $91.22 in the Futures was good for $3,500 per contract in the Futures but, of course, we were done being short, as planned at $88.50 and in fact made a couple of bullish trades – long on USO at $33 (as planned) and short on SCO at $44.  We'll see how they work out today but up at the open is a good sign.  

RUT WEEKLY HPQ was irresistible as it tested $15 (long-term positions) and BBY gave us a good entry again at $17.50.  We made a quick 50% on the TNA weekly $61.50 calls, which we grabbed for $1 in our $25,000 Virtual Portfolio at 10:09 in Member Chat and we caught a nice move up to $1.50 not even 30 minutes later as our 838 line (weak bounce) on the Russell continues to hold.  

Our bullish stance on AAPL finally paid off as the stock went from $660 to $672 at the close – hopefully $680 is next.  Gasoline only got to $2.75 (we were hoping for $2.70) but is back to $2.86 already in pre-market trading (/RB).  

As you can see from Dave Fry's Russell chart, we're still in a bullish consolidation – just below our breakout level and today, so far, we don't have rising Dollar headwinds to hold…
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Try it Again Tuesday – What Will it Take to Move the Markets Higher?

If it's Tuesday, we must be at the week's highs.  

Obviously, we're still bearish and the news we've been discussing this morning in Member Chat certainly hasn't changed my opinion on that.  Back on August 7th (first Tuesday of last month), I said we were about $700Bn in stimulus short of what we need to support S&P 1,400 and we knew we would have to wait a month to see how much we got from Draghi and Bernanke but, so far, and with Ben already out of the way, we have zero.  

At $10Bn per S&P point that puts our fair value all the way down to 1,330 but keep in mind that the $500Bn we did get only lasts for 6 months so more like 1,310 at this point without a proper commitment by the ECB or Fed this week.  Even 1,310 would be up 50 from the June lows and it would represent a neat 2/3 retracement of the rally since then.  Our $25,000 Portfolio has, if anything, gotten more bearish as we dragged along the top but another thing we've done each Tuesday has been to take aggressive bullish positions to cover ourselves IN CASE someone actually does put up the cash needed to goose the markets over our breakout levels (see Friday's post for current positions in the virtual Portfolio and our levels).  

On Tuesday, August 14th, our trade ideas were as follows:  

  • 2 FAS Oct $105/115 bull call spread at $2, selling 1 BBY 2014 $18 puts for $3.25 for net .75, now $1.80 – up 140% (trade stopped at 150%) -
  • 2014 SHLD $32.50 puts sold for $7.50, now $6 – up 20% 
  • 6 EWJ Jan $9 calls at .53, selling 1 BBY 2014 $18 put at $3.25 for a net .07 credit, still net $2.60 credit – down 3,800% (trade stopped at up 1,000%)  


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Trying the Tops on Tuesday – As Usual

Seriously, this is 4 Tuesday's in row – is anyone seeing a pattern?

Of course this Tuesday we are 100 Dow points lower than we were last Tuesday and the BS pre-market pump job at 6am has already faded (7:30) although we're still working short bets on the Russell futures (/TF) and the Euro (EUR/USD) from 813 and $1.256 as I put up a note in early morning Member Chat as we spiked on – get this – the news that Draghi cancelled his appearance at Jackson Hole this weekend.

Why would it be good that Draghi is NOT going to the last Central Bankster conference of the year but the buzz is that he MUST be so close to a masterful solution to all of Europe's problems that he can't be bothered to gather with his brother bankers on the eve of his triumph.  The announcement was timed to coincide (10 minutes before) bond auctions by Spain ($2Bn 3-month notes at 0.95%) and Italy ($3.75Bn of 2-year notes at 3.06%) and the Euro jumped 0.7% into the auction – lowering the effective rates and both auctions were a "success".

That pulled the EU markets off the floor (still down half a point at 8am) and got the US futures out of the red zone as we finally pushed the Dollar under that pesky 81.50 line, goosing the indexes and commodities.  Unfortunately, it's just a sugar rush and we've already run out of steam but I'm sure someone will start another rumor around 9:15 to get us back to green into the open.  

As I said last Tuesday, with the Dollar at 81.50 we're looking for adjusted levels of:  Dow 13,464, S&P 1,428, Nasdaq 3,060, NYSE 8,160 and Russell 816 and we held the Nasdaq yesterday but that was all so no reason to capitulate on our bearish stance just yet.  Last Tuesday we also discussed 3 more trades (there we 3 the Tuesday before) to make 300% if the market did break higher and our first batch had several 100% winners so let's see how our 3 new trades did in a downtrend:  

  • 2 FAS Oct $107/117 bull call spreads at $2.05, selling 1 BBY 2014 $15 puts for $3.75 for net .35 is now net $1.52 – up 334%
  • AGQ Oct $38/45 bull call spread at $3.10, selling BTU 2014 $20 puts for $3.60 for


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Best Buy Call Spread Looks For Further Upside

 

Today’s tickers: BBY, KNXA & NOK

BBY - Best Buy, Inc. – A bull call spread initiated on the world’s largest electronic retailer this morning suggests one option strategist is positioning for shares in Best Buy to potentially post double-digit percentage gains by January 2013 expiration. Shares in the retailer are up 5.9% at $18.33 this morning on news Best Buy agreed to permit its founder, Richard Schulze, to perform due diligence on the company required to further the process of possibly taking over the retailer with a group of private equity firms. The sizable spread was constructed through the purchase of 6,750 calls at the Jan. ’13 $19 strike call and the sale of the same number of calls up at the Jan. ’13 $23 strike, all for a net premium outlay of around $1.28 per contract. The spread makes money if shares in BBY rally another 11% to surpass the average breakeven price of $20.28, with maximum possible profits of $2.72 per contract available should the stock soar 25.5% to $23.00 by expiration next year. Options on Best Buy are more active than usual today, with volume in excess of 56,200 contracts running at approximately 156% of the stock’s average daily volume of 35,942 contracts.

KNXA - Kenexa Corp. – Shares in Kenexa Corp. are up nearly 42% this afternoon at $45.85 on news IBM agreed to buy the maker of human resources software for $1.3 billion in cash. It looks like the sharp move in the share price has some options traders sitting on substantial paper profits. Call open interest in Kenexa is largest at the Sep. $35 strike where 399 positions were initiated during the past few weeks. A 100-lot block was purchased at a premium of $1.00 back on August 9th and around 35 of the calls were picked up this past Friday at an average premium of $0.85 apiece. Call buyers paying up to $1.00 per contract for the…
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Try and Try Again Tuesday – 3 More Trade Ideas That Make 300% if the Market Pops

Here we go again (again)!

Yep, that's what I said last Tuesday and the Tuesday before that because Tuesday is a day they push the Futures higher and ditch the Dollar and tell you that this time it's different because of the same rumors they had the Tuesday before only this week – the data is getting worse and worse, as we know is better, right?  

Last Tuesday we set levels to capitulate and go fully bullish at Dow 13,464, S&P 1,428, Nasdaq 3,060, NYSE 8,160 and Russell 816 and, as of yesterday's close we had the Nasdaq and the Russell over their marks needing just one confirmation to make it 3 of 5 and begin to flip our short-term portfolios (the $25KPs) bullish.  We are soooo close but, so far – no cigar.  

While we waited, we looked at some upside hedges that would do well if the market continued higher.  Just as we get downside protection when we're bullish – we use upside protection when we're bearish and I suggested taking 5% or 10% positions in aggressive upside plays to help balance a bearish portfolio against – well against exactly what happened in the past 7 days.  Our trade ideas were:  

  • 2 FAS Oct $105/115 bull call spread at $2, selling 1 BBY 2014 $18 puts for $3.25 for net .75, now $1.15 – up 53%
  • 2014 SHLD $32.50 puts sold for $7.50, now $6.40 – up 15% 
  • 6 EWJ Jan $9 calls at .53, selling 1 BBY 2014 $18 put at $3.25 for a net .07 credit, still net .07 credit – even 
  • TNA Oct $55/61 bull call spread at $2.50, selling Oct $42 puts for $1.90 for net .60, now $1.80 – up 200%

The BBY puts jumped over 20% yesterday, from below $3 to $3.75 and that killed two of our trades (and worse today after earnings!), that were up significantly in Friday's update (which is why we take quick gains like that off the table).  The good news is the EWJ play gives us a nice, new entry at the same net price so that one is still good and, of course, we are done with TNA after making 200% in a week and we'll find a fresh horse for that money.

Speaking of fresh horses – for our offsetting short puts today – let's take…
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Phil's Favorites

Stall Speed Economy

 

Stall Speed Economy

Courtesy of John Mauldin, Thoughts from the Frontline

When Cornwallis surrendered to George Washington at Yorktown in 1781, tradition has it that the British band played an old English children’s folk tune, “The World Turned Upside Down.”


Painting by John Trumbull

If buttercups buzz’d after the bee,
If boats were on land, churches on sea,
If ponies rode men and if grass ate the cows,
And cats should be chased into holes by the mouse,
If the mamas sold their babies
To the gypsies for half a crown;
If summer were spring and the other way ‘round,
...



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ValueWalk

Coronavirus stimulus checks: Senate Republicans hint openness to working with Biden

By Aman Jain. Originally published at ValueWalk.

Republicans and Democrats have been unable to reach a consensus on the next stimulus package so far. Efforts by the White House to broker a deal haven’t resulted in success either. Thus, it looks unlikely that there will be any stimulus package before the November election. Similar signs are also being given by Senate Republicans, who are now hinting that they are open to striking a relief deal on coronavirus stimulus checks and other benefits with Joe Biden if he wins the presidential election in November.

Q2 2020 hedge fund letters, conferences and more

...

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Politics

Can Trump and McConnell get through the 4 steps to seat a Supreme Court justice in just 6 weeks?

 

Can Trump and McConnell get through the 4 steps to seat a Supreme Court justice in just 6 weeks?

A political battle is shaping up over the confirmation of the next Supreme Court Justice. Jose Luis Magana / AFP/Getty Images

By Caren Morrison, Georgia State University

United States Supreme Court Justice Ruth Bader Ginsburg died on Sept. 18, thrusting the acrimonious struggle for control of the Supreme Court into public view.

President Trump and Senate Majority Leader Mitch McConnell have already ...



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Zero Hedge

The Possible Limits Of China-Russia Cooperation

Courtesy of ZeroHedge View original post here.

Authored by Lawrence Franklin via The Gatestone Institute,

China and Russia's coordinated policies in foreign affairs and economic endeavors belie deep-seated fissures that might well prevent their current period of cooperation from evolving into a sustained alliance.

Despite China's planned participation in Russia's annual ...



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Chart School

Stocks are not done yet - Update

Courtesy of Read the Ticker

There are a few times in history when a third party said this US paper (stocks, funds or bonds) is worthless.

Here is two.

1) 1965 Nixon Shock - The French said to US we do not want your paper dollars please pay us in gold. This of course led to the US going off the gold standard.

2) 2007 Bear Stern Fund Collapse - Investors said their funds collateral was worth much less than stated. This of course was the beginning of the great america housing bust of 2008.


In both cases it was stated .."look the Emperor is naked!"... (The Empe...

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Kimble Charting Solutions

Gold Breakout Triggers Buy Signal, Is $3000 Next Target?

Courtesy of Chris Kimble

90-days ago this cup & handle pattern was discussed on See It Market when Gold was trading at 1717.

Fast-forward to today and Gold is up 15 percent. So it’s time for an update!

As we pointed out 90-days ago, the initial price magnet for the rally was the 261.8 Fibonacci extension that marked the 2011 high at (1).

That high has served as price resistance for nearly 9 years! …But it may be ...



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Biotech/COVID-19

Smoke from wildfires can worsen COVID-19 risk, putting firefighters in even more danger

 

Smoke from wildfires can worsen COVID-19 risk, putting firefighters in even more danger

Firefighters have battled camp crud before, but COVID-19 brings new risks with the potential for heart and lung damage. Robyn Beck/AFP/Getty Images

By Luke Montrose, Boise State University

Two forces of nature are colliding in the western United States, and wildland firefighters are caught in the middle.

Emerging research suggests that ...



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Digital Currencies

Cryptocurrencies Rarely Used To Launder Money, Fiat Preferred

Courtesy of ZeroHedge View original post here.

Authored by Shaurya Malwa via Decrypt.io,

Traditional channels continue to dominate the estimated $2 trillion global money laundering racket instead of cryptocurrencies, a report says.

In brief
  • Money laundering via cryptocurrencies is not a preferred tool for criminals, a report said...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

Free, Live Webinar on Stocks, Options and Trading Strategies

TODAY's LIVE webinar on stocks, options and trading strategy is open to all!

Feb. 26, 1pm EST

Click HERE to join the PSW weekly webinar at 1 pm EST.

Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

This week, we also have a special presentation from Mike Anton of TradeExchange.com. It's a new service that we're excited to be a part of! 

Mike will show off the TradeExchange's new platform which you can try for free.  

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

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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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