Posts Tagged ‘LO’

Lorillard Options Active Ahead Of Earnings

Options commentary will resume on July 24, 2013.

Today’s tickers: LO, AXP & VRSN

LO - Lorillard Inc. – Put options on the third-largest U.S. cigarette maker are changing hands today ahead of the company’s second-quarter earnings report on Thursday prior to the opening bell. Shares in the Lorillard are down more than 1.0% at $46.00 as of 1:05 p.m. in New York. The most actively traded options as measured by volume on LO as of the time of this writing are the August and September expiry puts. Front month options volume is concentrated in the Aug $42.5 strike puts, with around 4,700 lots traded versus open interest of 2,613 contracts. Time and sales data suggests most of the $42.5 strike puts were purchased for an average premium of $0.58 apiece during the first hour of the session. The Sep $40 strike puts are also in play, with nearly 7,000 contracts traded so far today. Much of the volume appears to have been purchased at a premium of $0.67 each. Overall options volume on the stock is hovering just below 12,500 contracts as of 1:15 p.m. ET, or roughly 160% of the stock’s average daily volume of around 7,750 contracts.

AXP - American Express Co. – Shares in American Express are in recovery mode today, up 1.4% at $75.11 in early afternoon trading after last week dipping more than 5.0%. Options activity on American Express this morning, however, indicates one or more traders are positioning for the price of the underlying to decline in the near…
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Tesla Options Heat Up As Shares Slide

Options brief will resume September 27, 2012.

Today’s tickers: TSLA, NYT & LO

TSLA - Tesla Motors, Inc. – Shares in electric vehicle maker, Tesla Motors, Inc., are taking a hit today, down 7.8% at $28.27 as of 11:05 a.m. ET, after the company lowered its third-quarter and full-year revenue estimates and said it plans to issue more stock. Options volume on Tesla is nearly twice the stock’s average daily volume this morning, with some strategists preparing for further declines in the price of the underlying. Near-term bearish positioning in the front month is heaviest at the Oct. $26 strike where upwards of 2,100 put options changed hands against open interest of 905 contracts. It looks like traders purchased most of these contracts for an average premium of $1.05 apiece. Put buyers stand ready to profit at expiration next month in the event that Tesla’s shares drop nearly 12% from the current price to settle below the breakeven point at $24.95. Bears also looked to the $28 strike put options expiring in October, buying around 800 contracts in the early going for an average premium of $2.01 each. The purchase of a 300-lot Oct. $29/$32 bear put spread on Monday prepared one strategist for an adverse move in the price of the underlying today. The trader appears to have purchased the spread for a net premium of $1.68 per contract yesterday afternoon, looking for a minimum 1.2% decline in the $30.70 share price at the time of the trade to the breakeven point at $30.32. Shares are currently trading well below the lower $29 striking price; maximum possible profits of $1.32 per contract are available on the strategy at October expiration as long as shares settle below $29.00. Finally, contrarian players positioning for a rebound in TSLA shares in the next four weeks picked up around 400 calls at the Oct. $29 strike for an average premium of $1.07 apiece. Call buyers stand ready to profit at expiration should the stock rally at least 6% over the current price to exceed $30.07.…
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Put Player Positions for a Pullback in Lorillard Shares

Today’s tickers: LO, HMA, AMR & USO

LO - Lorillard Inc. – A three-legged spread involving April contract put options on the cigarette manufacturer appears to be the work of an investor positioning for the price of the underlying stock to slip ahead of expiration. Shares in Lorillard, the maker of Newport cigarettes, the number one menthol brand, are currently up 0.33% to stand at $78.00 as of 12:50pm. The stock rallied as much as 5.7% one week ago to trade as high as $81.18 after the FDA said the risk of lung cancer for smokers of menthol cigarettes does not differ significantly from that of non-menthol cigarettes. But, last week’s sharp run up in LO’s shares was fairly short-lived given other portions of the FDA report that were not quite as positive for big tobacco. One trader expecting Lorillard’s shares to fall in the near-term seems to have established a bearish butterfly spread. The investor picked up 5,000 puts at the April $75 strike for a premium of $4.40 each, sold 10,000 puts at the April $65 strike for a premium of $1.50 apiece, and purchased 5,000 puts at the April $55 strike for a premium of $0.35 a-pop. Net premium paid to initiate the put ‘fly amounts to $1.75 per contract. The trader profits if LO’s shares decline 6.1% from the current price of $78.00 to breach the effective breakeven point at $73.25 by April expiration. Maximum potential profits of $8.25 per contract pad the investor’s wallet in the event that shares plummet 16.7% to settle at $65.00 at expiration. Options implied volatility on the cigarette-stock is up 3.4% at 54.92% just after 1:00pm in New York.

HMA - Health Management Associates, Inc. – Shares in the health care services provider are down 1.4% in early afternoon trade to…
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Butterflies, Straddles and Spreads, Oh My!

Today’s tickers: HRS, EWZ, RSH, PNRA, IVN, LO & DOW

HRS – Harris Corp. – A three-legged bullish play on the international communications and information technology company that serves government and commercial markets around the world indicates one option strategist expects shares of the underlying stock to rally significantly by expiration day in February 2011. Harris Corp.’s shares are up 0.95% at $44.46 just before 2:30 pm (ET), but earlier in the session rallied as much as 1.8% to an intraday high of $44.84. HRS shares moved higher on news the firm recently won a number of large contracts. One such contract is a 30-month, $25-million contract under the Network-Centric Solutions contract vehicle, which requires Harris to upgrade network infrastructure at 15 National Guard sites. Harris Corp. popped up on our ‘hot by options volume’ market scanner in the first half of the trading day following the implementation of a three-legged bullish transaction. The investor responsible for the trade essentially sold puts to finance the purchase of a debit call spread. In doing so, the trader sold 1,500 puts at the February 2011 $35 strike for a premium of $1.75 per contract, purchased 1,500 calls at the February 2011 $45 strike for a premium of $4.65 each, and sold 1,500 calls at the higher February 2011 $55 strike for premium of $1.20 apiece. The net cost of the transaction amounts to $1.70 per contract. Thus, the options player is poised to profit as long as Harris Corp.’s shares rally 5.00% over the current price of $44.46 to surpass the effective breakeven point at $46.70 by expiration day. The investor walks away with maximum potential profits of $8.30 per contract if HRS shares surge 23.7% to trade above $55.00 by February 2011 expiration. The short put stance at the February 2011 $35 strike implies the investor is happy to have 150,000 shares of the underlying stock put to him at $35.00 each should the puts land in-the-money by expiration day.

EWZ – iShares MSCI Brazil Index Fund – An investor itching for a rally in shares of the Brazil ETF purchased a bullish call butterfly spread in the August contract this afternoon. Shares of the EWZ, an exchange-traded fund designed to correspond to the price and yield performance of publicly traded securities in the aggregate in the Brazilian market, as measured by the MSCI Brazil Index, fell 1.05% to trade at…
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Mega Earnings Monday – 1,000 Reports This Week!

What a crazy week this is going to be!

Pre-Market we're hearing from BLK, CAT (are we building stuff?), EXP, HTZ, HUM, LO, TUES and TZOO and later we will hear from BSX, CHH, OLN, RSH, RCII, TXN (major) and my "friendbuddypal" Cramer's TSCM (if they are not delayed).  Revenues at The Street have crept back up this year in a recovery that pretty much mirrors the market.  The company does pay a nice 2.6% dividend, which works out to a nice $200,000 bonus on Jimmy's 2.1M shares (6.7% of the company) so you know that bonus will be a priority for the company.  Cramer was BUYBUYBUYing his own stock at $2.41 in January but sadly they have no options to hedge…  They might make a nice pick-up after earnings if they disappoint and head back to $3 or less.

I'm full of useful information on hundreds of stocks right now because I've been researching our new Buy List but I'm not pleased with what I've been seeing so far and this week's tidal wave of earnings, with 1,000 companies reporting means we're in no hurry to dip our toes in the water.  I told Members this morning I should probably be working on a Sell List, as it's much easier to find companies I want to short than ones I want to buy.  Even in the Weekly Wrap-Up, we featured a 1,900% downside hedge on the Russell to offset the 566% plays and other bullish plays we've begun to reluctantly take, just so we don't feel too silly in this runaway market. 

If you have never watched Jim Cramer discussing the sleazy, manipulative ways he used to game the markets – you really must take 10 minutes and watch this video, where Jim explains how any immoral bastard with $10M can yank the entire futures market around at will.  He prefaces one of his favorite strategies with "this is blatantly illegal but.. I think it's really important… these are things you MUST do on a day like today and if you are not doing it, maybe you shouldn't be in the game."  Are you playing the game or are you being played? 

The biggest game ever played may be unwinding as we speak.  Bloomberg reports that foreign-exchange profits from carry trades are disappearing as differences in central
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Apple Shares Reach New 52-Week High Ahead of iPad Release

Today’s tickers: AAPL, GDXJ, CEPH, LO, MHK, VRTX & MJN

AAPL – Apple, Inc. – Shares of the iPhone and iPod maker rallied to a new 52-week high of 233.87 in morning trading with just five days remaining before the firm’s newest product, the iPad, hits retail stores across the U.S. Bullish options trading patterns on the stock today indicate optimistic sentiment on Apple ahead of the iPad’s release on Saturday morning. One investor enacted a bullish put credit spread in the May contract in order to benefit from continued strength in the price of Apple’s shares through expiration. It looks like approximately 10,000 puts were shed at the May $210 strike for an average premium of $3.46 per contract, marked against the purchase of about the same number of puts at the lower May $200 strike for $1.95 each. The investor responsible for the spread pockets a net credit of $1.51 per contract, which he keeps in full as long as Apple’s shares trade above $210.00 through May expiration. Maximum potential losses faced by the trader amount to $8.49 per contract should shares of the underlying stock plummet 14.5% to $200.00 ahead of expiration day in May.

GDXJ – Market Vectors Junior Gold Miners ETF – The GDXJ, which is an exchange-traded fund that seeks to replicate the price and yield performance of the Market Vectors Junior Gold Miners Index, realized a 1.25% appreciation in the value of its underlying share price to $25.82 today. The Market Vectors Junior Gold Miners Index tracks the overall performance of foreign and domestic publicly traded companies of small/medium-capitalization that primarily engage in gold and/or silver mining. Despite the move higher in shares today, one options trader initiated a bearish debit put spread in the May contract. It appears the investor purchased 10,000 in-the-money puts at the May $26 strike for a premium of $1.65 apiece and sold the same number of puts at the lower May $23 strike for $0.52 each. The net cost of the put spread amounts to $1.13 per contract. If the investor responsible for the trade holds no underlying share position, maximum potential profits of $1.87 per contract are available if shares slip to $23.00 by expiration day in May. However, the trader may be buying the spread to protect the value of an existing underlying share position, in which case protection kicks in beneath the breakeven share…
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Retail ETF Sees Large Protective Ratio Put Play

Today’s tickers: XRT, CSX, POT, MON, LO & DRYS

XRT– Shares of the retail ETF have lifted higher by more than 6% to $29.19 today despite the decline in U.S. consumer spending for the second month in a row. Spending continues to suffer in the face of rising unemployment and increased efforts to save by consumers still raw from the record wealth destruction experienced in the recession. We observed one investor populate the XRT with a ratio put spread likely employed to lock into gains enjoyed on the recent rally and to establish protection from potential downward movement in shares through September’s expiration. The ratio spread involved the purchase of 25,000 puts at the September 25 strike price for a premium of 1.17 apiece which were spread against the sale of 50,000 puts at the lower September 20 strike for about 35 cents per contract. The net cost of the transaction amounts to 82 cents and yields maximum potential profits of 4.18 if shares were to edge down to $20.00 by expiration. – SPDR Retail ETF

CSX– The rail-based transportation supplier has experienced a share price rally of more than 6.5% to $33.94 in today’s trading session, attracting a plethora of option traders to the station. Near-term investors locked into recent gains by getting long of put options some 3,000 times at the June 33 strike price for 1.19 each. The higher and now in-the-money June 34 strike price saw 1,200 puts bought for 1.51 apiece. Bullish options sentiment spread to the July 35 strike price where 3,900 calls were scooped up for an average premium of 2.10 each. Call buyers at the July 35 strike are looking for shares of CSX to climb another 9% through the breakeven point at $37.10 in order to garner profits by expiration. Optimism for continued bullish movement in the stock spread to the November contract where it appears one trader has enacted a butterfly spread. The purchase of 6,000 calls at the November 40 strike price for 2.10 apiece [body] was offset by the sale of 3,000 calls at the November 35 strike for 3.80 each [wing 1] and by the sale of 3,000 calls at the higher November 45 strike price for 1.00 per contract [wing 2]. The trader receives a 60 cent credit for the transaction (1*3.80 + 1*1.00 – 2*2.10 = 0.60 cents). The investor would retain the net
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Zero Hedge

Italian Cases Soar Past 300 As EU Stubbornly Refuses To Close Borders; 10 Dead: Live Updates

Courtesy of ZeroHedge View original post here.

Summary:

  • WHO warns the rest of the world "is not ready for the virus to spread..."

  • CDC warns Americans "should prepare for possible community spread" of virus.

  • Italy cases spike to 322; deaths hit 10

  • HHS Sec. Azar warns US lacks stockpiles of masks

  • Italy Hotel in Lockdown ...



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Phil's Favorites

World economy flashes red over coronavirus - with strange echoes of 1880s Yellow Peril hysteria

 

World economy flashes red over coronavirus – with strange echoes of 1880s Yellow Peril hysteria

Courtesy of John Weeks, SOAS, University of London

As the novel coronavirus pandemic continues to unfold, travel restrictions are being imposed around the world. China is the main target, with various countries including Australia, Canada and the US placing different restrictions on people who have travelled through the country ...



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Biotech & Health

World economy flashes red over coronavirus - with strange echoes of 1880s Yellow Peril hysteria

 

World economy flashes red over coronavirus – with strange echoes of 1880s Yellow Peril hysteria

Courtesy of John Weeks, SOAS, University of London

As the novel coronavirus pandemic continues to unfold, travel restrictions are being imposed around the world. China is the main target, with various countries including Australia, Canada and the US placing different restrictions on people who have travelled through the country ...



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Kimble Charting Solutions

Dow Industrials Reversal Lower Could Be Double Whammy for Stock Bulls!

Courtesy of Chris Kimble

Dow Jones Industrial Average “monthly” Chart

The Dow Industrials have spent the past 70 years in a wide rising price channel marked by each (1). And the past 25 years have seen prices test and pull back from the upper end of that channel.

The current bull market cycle has seen stocks rise sharply off the 2009 lows toward the upper end of that channel once more.

In fact, the Dow has been hovering near the topside of that price channel for several months.

But just as the Dow is kissing the top of this channel, it might be creating back-to-back “monthly” bearish ...



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Insider Scoop

Benzinga's Top Upgrades, Downgrades For February 25, 2020

Courtesy of Benzinga

Upgrades
  • Sidoti & Co. changed the rating for FormFactor Inc (NASDAQ: FORM) from Neutral to Buy. For the fourth quarter, FormFactor had an EPS of $0.41, compared to year-ago quarter EPS of $0.31. The stock has a 52-week-high of $28.58 and a 52-week-low of $14.20. FormFactor's stock last closed at $23.16 per share.
Downgrades
  • Dougherty downgraded the stock for Palo Alto Networks Inc (NYSE: PANW) from Buy to Neutral. Palo Alto Networks earned $1.19 in the second quarter. The stock has a...


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The Technical Traders

Yield Curve Patterns - What To Expect In 2020

Courtesy of Technical Traders

Quite a bit of information can be gleaned from the US Treasury Yield Curve charts.  There are two very interesting components that we identified from the Yield Curve charts below.  First, the bottom in late 2018 was a very important price bottom in the US markets.  That low presented a very deep bottom in the Yield Curve 30Y-10Y chart.  We believe this bottom set up a very dynamic shift in the capital markets that present the current risk factor throughout must of the rest of the world.  Second, this same December 2018 price bottom set up a very unique consolidation pattern on the 10Y-3Y Yield Curve chart.  This pattern has been seen before, in late 1997-1998 and late 2005-2008.

...

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Chart School

Oil cycle leads the stock cycle

Courtesy of Read the Ticker

Sure correlation is not causation, but this chart should be known by you.

We all know the world economy was waiting for a pin to prick the 'everything bubble', but no one had any idea of what the pin would look like.

Hence this is why the story of the black swan is so relevant.






There is massive debt behind the record high stock markets, there so much debt the political will required to allow central banks to print trillions to cover losses will likely effect elections. The point is printing money to cover billions is unlikely to upset anyone, however printing trillions will. In 2007 it was billions, in 202X it ...

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Members' Corner

Threats to democracy: oligarchy, feudalism, dictatorship

 

Threats to democracy: oligarchy, feudalism, dictatorship

Courtesy of David Brin, Contrary Brin Blog 

Fascinating and important to consider, since it is probably one of the reasons why the world aristocracy is pulling its all-out putsch right now… “Trillions will be inherited over the coming decades, further widening the wealth gap,” reports the Los Angeles Times. The beneficiaries aren’t all that young themselves. From 1989 to 2016, U.S. households inherited more than $8.5 trillion. Over that time, the average age of recipients rose by a decade to 51. More ...



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Digital Currencies

Altcoin season 2.0: why bitcoin has been outgunned by crypto rivals since new year

 

Altcoin season 2.0: why bitcoin has been outgunned by crypto rivals since new year

‘We have you surrounded!’ Wit Olszewski

Courtesy of Gavin Brown, Manchester Metropolitan University and Richard Whittle, Manchester Metropolitan University

When bitcoin was trading at the dizzying heights of almost US$2...



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ValueWalk

What US companies are saying about coronavirus impact

By Aman Jain. Originally published at ValueWalk.

With the coronavirus outbreak coinciding with the U.S. earnings seasons, it is only normal to expect companies to talk about this deadly virus in their earnings conference calls. In fact, many major U.S. companies not only talked about coronavirus, but also warned about its potential impact on their financial numbers.

Q4 2019 hedge fund letters, conferences and more

Coronavirus impact: many US companies unclear

According to ...



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Lee's Free Thinking

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

 

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

Courtesy of  

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,

The ‘experts’ I hear from keep saying that once 300B more in reserves have ...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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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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