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

10 ways to spot online misinformation

 

10 ways to spot online misinformation

When you share information online, do it responsibly. Sitthiphong/Getty Images

Courtesy of H. Colleen Sinclair, Mississippi State University

Propagandists are already working to sow disinformation and social discord in the run-up to the November elections.

Many of their efforts have focused on social media, where people’s limited attention spans push them to ...



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Members' Corner

10 ways to spot online misinformation

 

10 ways to spot online misinformation

When you share information online, do it responsibly. Sitthiphong/Getty Images

Courtesy of H. Colleen Sinclair, Mississippi State University

Propagandists are already working to sow disinformation and social discord in the run-up to the November elections.

Many of their efforts have focused on social media, where people’s limited attention spans push them to ...



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Zero Hedge

"The Scope For Pain Is Immense" - China's Consumer Default Tsunami Has Started

Courtesy of ZeroHedge View original post here.

One month ago we reported that "China Faces Financial Armageddon With 85% Of Businesses Set To Run Out Of Cash In 3 Months", in which we explained that while China's giant state-owned SOEs will likely have enough of a liquidity lifeblood to last them for 2-3 quarters, it is the country's small businesses that are facing a head on collision with an iceberg, because ...



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Biotech/COVID-19

The world before this coronavirus and after cannot be the same

 

The world before this coronavirus and after cannot be the same

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Courtesy of Ian Goldin, University of Oxford and Robert Muggah, Pontifical Catholic University of Rio de Janeiro (PUC-Rio)

With COVID-19 infections now evident in 176 countries, the pandemic is the most significant threat to humanity since the second world war. Then, as now, confidence in international cooperation and institutions plumbed new lows.

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Digital Currencies

While coronavirus rages, bitcoin has made a leap towards the mainstream

 

While coronavirus rages, bitcoin has made a leap towards the mainstream

Get used to it. Anastasiia Bakai

Courtesy of Iwa Salami, University of East London

Anyone holding bitcoin would have watched the market with alarm in recent weeks. The virtual currency, whose price other cryptocurrencies like ethereum and litecoin largely follow, plummeted from more than US$10,000 (£8,206) in mid-February to briefly below US$4,000 on March 13. Despite recovering to the mid-US$6,000s at the time of writin...



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Insider Scoop

'Psyched': Hawaii Considers Resolution For Shrooms, Champignon Eyes Ketamine Products

Courtesy of Benzinga

Psyched is a bi-monthly column covering the most important developments in the industry of medicinal psychedelics. We hope you follow us periodically as we report on the growth of this exciting new industry.

Champignon Brands Buys IP Company and Adds Ketamine and New Formulations To Its Portfolio

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The Technical Traders

These Index Charts Will Calm You Down

Courtesy of Technical Traders

I put together this video that will calm you down, because knowing where are within the stock market cycles, and the economy makes all the difference.

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Kimble Charting Solutions

Broadest Of All Stock Indices Testing Critical Support, Says Joe Friday!

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One of the broadest indices in the states remains in a long-term bullish trend, where a critical support test is in play.

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The index has spent the majority of the past three decades inside of rising channel (1). It hit the top of this multi-decade channel to start off the year, where it created a monthly bearish reversal pattern.

Weakness the past 2-months has the index testing rising support and the December 2018 lows at (2).

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Chart School

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Non believers of cycles become fast believers when the heat of the moment is upon them.

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ValueWalk

Entrepreneurial activity and business ownership on the rise

By Jacob Wolinsky. Originally published at ValueWalk.

Indicating strong health of entrepreneurship, both entrepreneurial activity and established business ownership in the United States have trended upwards over the past 19 years, according to the 2019/2020 Global Entrepreneurship Monitor Global Report, released March 3rd in Miami at the GEM Annual Meeting.

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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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Lee's Free Thinking

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

 

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The repo market problem isn’t the problem. It’s a sideshow, a diversion, and a joke. It’s a symptom of the problem.

Today, I got a note from Liquidity Trader subscriber David, a professional investor, and it got me to thinking. Here’s what David wrote:

Lee,

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Mapping The Market

How IPOs Are Priced

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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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