Posts Tagged ‘EMR’

Options Player Takes to Beazer Homes USA

Today’s tickers: BZH, CPB, EMR & RENN

BZH - Beazer Homes USA, Inc. – Shares in the designer and builder of single- and multi-family homes increased as much as 5.7% today to $3.53, joining other homebuilding companies in a sector rally ahead of May new home sales data due out on Thursday morning. One options player populating Beazer Homes this afternoon constructed what appears to be a long-term bullish bet on the stock. It looks like the investor sold 3,000 puts at the January 2012 $3.0 strike for a premium of $0.42 each in order to purchase 3,000 calls up at the February 2012 $4.0 strike at a premium of $0.52 apiece. Net premium paid to get long the calls amounts to $0.10 per contract and positions the trader to make money should Beazer’s shares surge 16.15% over today’s high of $3.53 to surpass the effective breakeven price of $4.10 at February expiration. Shares in BZH last traded above $4.10 on June 1. The stock is currently down more than 43% off its January 14th 52-week high of $6.23. Beazer Homes USA reports third-quarter earnings before the market opens on August 2.

CPB - Campbell Soup Co. – Demand for put options on the food products manufacturer jumped this morning after analysts at Goldman Sachs reportedly recommended buying July $33 strike puts on the chicken noodle soup maker ahead of the company’s analyst day. The sharp increase in put activity on the stock sent Campbell’s overall reading of options implied volatility up 34.4% to 16.55% by 12:05pm in New York. Shares in CPB currently trade 0.60% lower on the day at $34.01. The July $33 strike put is by far the most active this afternoon, with more than 7,400 puts having changed hands against previously existing open interest of just 576…
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Lifting the Axle

Today’s tickers: AXL, PALM, POT, XLF, EMR, AA, & BIIB

AXL – Shares of the Tier 1 supplier of parts and components to the automotive industry have rallied more than 8.5% to a whopping $2.78 today. The improvement in the stock, since touching down to just 26 cents on March 9, 2009, prompted one uber-bullish investor to enact a call spread in the October contract. The trader seems to have determined that the $300 million cut in AXL’s second- and third-quarter revenue streams, felt in the wake of its bankruptcy-brethren GM and Chrysler, will have been replenished by the fall. The summer shutdowns by the automakers are certainly painful for the time being as the two behemoths account for 90% of AXL’s annual revenue. Hoping for a ridiculous turnaround in circumstances, the investor initiated the purchase of 10,000 calls at the October 5.0 strike price for a premium of 40 cents apiece which were spread against the sale of 10,000 calls at the higher October 7.5 strike for about 15 cents each. The net cost of the transaction amounts to 25 cents and yields maximum potential profits of 2.25. Shares will need to grow with the tenacity of the Hulk in order to rally more than 169% over the next five months. – American Axle & Manufacturing Holdings, Inc.

PALM – Put options on the mobile devices company were favored by option investors on the scene today amid a share price decline of 3% to $13.22. One trader targeted the July contract in order to initiate a bearish ratio put spread. The transaction involved the purchase of 2,800 puts at the in-the-money July 14 strike puts for a premium of 2.82 per contract spread against the sale of 5,600 puts at the lower July 10 strike for about 70 cents apiece. The net cost of the pessimistic play on PALM amounts to 1.42 and yields maximum potential profits of 2.58 to the trader if shares decline down to $10.00 by expiration. Profits begin to amass if shares fall another 5% to the breakeven point at $12.58 by expiration next month. Option implied volatility has ramped up significantly over the past couple of days from 93% at the start of Thursday to the current reading of 112% ahead of the release of The Pre tomorrow. – Palm, Inc.

POT– We observed an interesting use of out-of-the-money puts by one investor on
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Sun bulls still looking for better news using option spreads

Today’s tickers: JAVA, APOL, EWZ, EMR, BBBY, WYNN, CSCO, CBG, GE & AA

JAVA Sun Microsystems, Inc. – Shares continue to slide for the second day after JAVA allegedly rejected IBM’s offer of $9.40 per share because it was too low. Currently, shares have declined by more than 4.5% to $6.26. A couple of contrasting trades caught our attention as one investor played the downside and another looked for upside movement in shares. In the May contract it appears that a ratio put spread was initiated with the sale of 22,000 puts at the May 5.0 strike for 46 cents each spread against the purchase of 11,000 puts at the May 6.0 strike for 89 cents apiece. The investor receives a credit of 3 cents for initiating this trade and stands to make a maximum profit of 103 cents if shares decline to $5.00 by expiration, but would burst apart at the seams should Sun’s shares breach $3.97. Further along in the October contract, a trader hoping to see JAVA rebound put on a bullish call spread which was partially funded by the sale of put options. At the October 5.0 strike price 10,000 puts were sold for a premium of 80 cents apiece. Meanwhile, a bull call spread was established via the purchase of 10,000 calls at the October 7.0 strike for 1.15 each and spread against the sale of 10,000 calls at the October 9.0 strike price for a premium of 40 cents apiece. This optimistic strategy yields the investor a 5 cent credit because the premium enjoyed on the sale of the put options and the sale of the higher strike calls more than offsets the cost of the October 7.0 strike call options. If shares can rally to $9.00 by expiration this fall, the investor stands to gain a maximum profit of 2.00 on the call spread plus the 5 cent premium. The two trades indicate bearishness in the near-term and bullishness as we head towards the concluding months of 2009.

APOL Apollo Group, Inc. – A provider of higher education to working adults, Apollo Group has experienced a 9% drop in shares to $63.17. Apollo’s share price slipped last week after the company warned that its profit margins would likely fail to meet analyst expectations. The recent share price erosion appears to be too severe as APOL still forecasts that it will achieve a 24%…
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Phil's Favorites

Why governments are so bad at implementing public projects

 

Why governments are so bad at implementing public projects

Around the world, government officials fail often at implementing policy and public sector projects. Here’s why. (Shutterstock)

Courtesy of Andrew Graham, Queen's University, Ontario

As Canada’s federal government starts looking for a replacement for its failed payroll system and the Ontario provincial government launches yet another major shake-up of its health-care system, it’s ...



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Zero Hedge

IMF Discreetly Preps Massive Aid Package For "Day After" Maduro's Fall

Courtesy of ZeroHedge. View original post here.

The International Monetary Fund is reportedly making plans for the "day after" embattled President Nicolas Maduro's fall, according to Bloomberg. Though there's been little momentum in military defections following US-backed opposition leader Juan Guaido's offer of amnesty to any army officer that switches loyalties, Washington sanctions have effectively strangled state-owned PDVSA's access to global markets. News of IMF maneuvering also comes amidst fresh reports the US is amassing aircraft, troops and armored vehicles on the Venezuelan border under the pretext ...



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Kimble Charting Solutions

Gasoline bullish breakout could fuel higher prices, says Joe Friday

Courtesy of Chris Kimble.

Are we about to pay much higher prices at the gas pump? Possible!

This chart looks at Gasoline futures over the past 4-years. Gasoline has become much cheaper at the pump, as it fell nearly 50% from the May 2018 highs. The decline took it down to test 2016 & 2017 lows at (1). While testing these lows, Gasoline could be forming a bullish inverse head & shoulders pattern over the past few months.

Joe Friday Just The Facts- If Gasoline breaks out at (2), we could all see higher prices at the gas pump. If a breakout does...



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Insider Scoop

10 Stocks To Watch For February 15, 2019

Courtesy of Benzinga.

Some of the stocks that may grab investor focus today are:

  • Wall Street expects PepsiCo, Inc. (NASDAQ: PEP) to report quarterly earnings at $1.49 per share on revenue of $19.52 billion before the opening bell. PepsiCo shares rose 0.2 percent to $112.82 in after-hours trading.
  • NVIDIA Corporation (NASDAQ: NVDA) reported upbe...


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ValueWalk

Global Quality Edge Fund: Tail-Risk Hedging Strategy

By Jacob Wolinsky. Originally published at ValueWalk.

Global Quality Edge Fund presentation titled, “Tail-Risk Hedging Strategy.” How to leverage the end of the business cycle without exposing our fund to permanent capital loss?

Alexas_Fotos / Pixabay

Objective:

  • Understand the current convergence between business cycle and the long term debt cycle.
  • Empathize the benefits of Tail Hedging as a means to shield from capital loss. We began implementing this strategy in Q4-2018 to protect the fund from significant market downturns, similar in sca...


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Biotech

Cancer: new DNA sequencing technique analyses tumours cell by cell to fight disease

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

 

Cancer: new DNA sequencing technique analyses tumours cell by cell to fight disease

Illustration of acute lymphoblastic leukaemia, showing lymphoblasts in blood. Kateryna Kon/Shutterstock

Courtesy of Alba Rodriguez-Meira, University of Oxford and Adam Mead, University of Oxford

...

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Chart School

Weekly Market Recap Feb 10, 2019

Courtesy of Blain.

A good week for the bulls once again as a very overbought market essentially went sideways to help work off some of those near term extreme conditions.  The S&P 500 stalled exactly at the 200 day moving average after a frantic rally the past month and a half.  It was generally a quiet week with lowered volatility as the word “patience” continues to have the investor class in a happy daze.

In economic news, ISM Services fell from 58.0 in December to 56.7 last month, below economists’ expectations of a 57.4 reading. A reading above 50 indicates an expansion in activity.

For the week the S&P 500 gained 0.1% and the NASDAQ 0.5%.  That is 7 up weeks in a row.

Here is the 5 day weekly “intraday” chart of the S&P 500 … ...



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Digital Currencies

People don't trust blockchain systems - is regulation a way to help?

 

People don't trust blockchain systems – is regulation a way to help?

Using blockchain technology can feel like falling and hoping someone will catch you. Nicoleta Raftu/Shutterstock.com

Courtesy of Kevin Werbach, University of Pennsylvania

Blockchain technology isn’t as widely used as it could be, largely because blockchain users don’t trust each other, as research shows. Business lea...



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Members' Corner

Why Trump Can't Learn

 

Bill Eddy (lawyer, therapist, author) predicted Trump's chaotic presidency based on his high-conflict personality, which was evident years ago. This post, written in 2017, references a prescient article Bill wrote before Trump even became president, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...



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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

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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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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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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