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Free Earnings Trade of the Week: Activision Blizzard, Inc. (ATVI) – Reports After the Markets Close 2/9/17

Activision Blizzard, Inc. (ATVI) is scheduled to report earnings after the markets close on Thursday, 2/9/17.

Last quarter, the stock had the following price movement after reporting earnings:


Nov 03, 2016

42.96
43.67
42.63
43.37
43.37
12,822,700

Nov 02, 2016

42.63
43.09
42.26
42.60
42.60
7,792,900

The current Implied Volatility on the weekly at-the-money strike price is at 175, which is extremely high. The at-the-money March 2017 strike price is at 36, so there is a major difference. The Neutral Calendar Spread is the strategy to use here. Everything looks good about it: weekly options, price to place the trade, wide break-even points, break-even points, and the high IV on the weekly at-the-money strike price. 9.5/10, trade of the week.

Here is how the trade is placed:

Entered Trade

Sell -20 ATVI FebWk2 40 Call

Buy 20 ATVI Mar17 40 Call

Requirements

Cost/Proceeds
$720.00
Option Requirement
$0.00
Total Requirements
$720.00
Estimated Commission
$50.00

NBBO -0.29 – 0.43. Try to pay 0.37 or less for this trade. at a maximum, pay up to 0.38. See the attachment for the profit/loss chart. I will post the price to close this trade out right before the markets open tomorrow.

Update #1: 9:20 am EST – Pre-market, the stock is up about $4.70/share, but do expect the share price to fall. I am placing the price to close this trade out at $0.60 (net credit). I will update any changes here throughout the day.

Update #2: STC (net credit) now at 0.50.

Free Earnings Trade of the Week: GoPro, Inc. (GPRO) – Reports After the Markets Close On 11/3/16

GoPro, Inc. (GPRO) is scheduled to report earnings after the markets close on Thursday, 11/3/16.

Last quarter, the stock had the following price movement after reporting earnings:

Jul 28, 2016

12.15
13.28
11.75
13.02
24,145,000
13.02

Jul 27, 2016

11.47
11.83
11.42
11.57
10,651,700
11.57

The Implied Volatility on the weekly at-the-money strike price is an extremely high 401. This is very rare. Compared this number to the November 2016 at-the-money strike price of 113, which is still high, but there’s still a huge discrepancy here. If the stock make a similar move as to what it did last quarter, the trade and strategy I am using here, the Neutral Calendar Spread, will be very profitable immediately. The price is excellent to place this trade, as well, with weekly options available. 9/10.

Here is how to place this trade:

Entered Trade

Sell -75 GPRO NovWk1 12 Call

Buy 75 GPRO Nov16 12 Call

Requirements

Cost/Proceeds
$750.00
Option Requirement
$0.00
Total Requirements
$750.00
Estimated Commission
$187.50

NBBO
gpro-ncs-11316 0.06 – 0.13. Try to pay 0.10 or less for this trade. At a maximum, pay up to 0.11. See the attachment for the profit/loss chart. I will post the price to close this position out tomorrow morning right before the opening bell.

Update 1: 9:22 am EST, 11/4/16 – Pre-market, the stock is down about $2.00/share. This is close to what I expected, so I am anticipating the stock to recover off this low. I am placing the STC (net credit) at 0.30 for now, and will update any changes to this here.

Update 2, 10:07 am EST – price to close this trade out (net credit) now at 0.25.

Update 3: 10:42 am EST. Position closed at 0.27. Paid 0.12.

Earnings Season Starts This Week – Will Be a Busy Few Weeks Trading

With Alcoa (AA) and the big bank stocks reporting earnings this week (C), (JPM), (WFC), the next month will be full of earnings trades. I use trading strategies that take a neutral approach towards earnings. These include the Strangle, the Reverse Iron Condor, and the Neutral Calendar Spread.

There are still a couple of days left for the reduced subscription rates + match plan that I am offering.

If you have any questions about options or the strategies mentioned above, please e-mail me at: kmob79@gmail.com

Thanks.

-Kevin

Earnings Trade of the Week: Skechers U.S.A., Inc. (SKX) – Reports After The Markets Close On Thursday, 4/21/16

Skechers U.S.A., Inc. (SKX) is scheduled to report earnings after the markets close on Thursday, 4/21/16.

Last quarter, the stock had the following price movement after reporting earnings:

Feb 11, 2016

29.30
30.35
26.35
28.24
12,018,500
28.24


Feb 10, 2016

27.23
28.14
27.01
27.17
4,247,300
27.17

The Implied Volatility (IV) on the weekly April Week 4 expiration at-the-money strike is a extremely high 301.69, compared to the May 2016 at-the-money strike of 66.77. Clearly, there is a big price move expected in relation to the share price. I don’t think it happens. Just as last quarter, the stock really didn’t move too much, and while I expect it to do more than that this quarter, a trader has to take advantage of past history and an elevated IV level as this trade has, which will again be a Neutral Calendar Spread. This trade, as mentioned, has weekly options, is priced very good, and a lot of factors working in its favor. It will also hold value very well even in the event it moves more than expected post-earnings. I am giving this trade a 10/10. A must trade.

Here is how the trade is placed:

Entered Trade

Sell -75 SKX AprWk4 30 Call

Buy 75 SKX May16 30 Call

Requirements

Cost/Proceeds
$2,850.00
Option Requirement
$0.00
Total Requirements
$2,850.00
Estimated Commission
$225.00


Greeks / NBBO

SKX AprWk4
30 Call
301.69

SKX May16
30 Call
66.77

NBBO
0.25 – 0.50. Try to pay 0.38 or less for this trade. At a maximum, pay up to 0.41.

See the attachment for the profit/loss chart.

SKX NCS 42116

Update 1: 4/22/16, 9:20 am EST: Pre-market, the stock is up $2.20/share. I am placing the price to close this trade out (net credit) at 1.00. I will update any changes here, if needed.

Update 2 9:34 am EST: : Price to close this trade out now at 0.85.

Next Weeks Earnings Schedule (4/18/16 – 4/22/16) – Busy Week Ahead

Next week will be on of the busiest all year in terms of the quantity (and quality) of earnings trades. Among the stocks reporting earnings are the following that I will most likely be trading: (Note: those in bold take preference)

LII, NFLX, RCL, DFS, HOG, ILMN, INTC, ISRG, EDU, PM, AXP, CTXS, FFIV, CCK, LVS, PKG, TSCO, YUM, TXT, SLM, URI, AMD, AMZN, GOOGL, SAM, BJRI, GM, MAN, MSFT, PII, SBUX, UA, UAL, V, UNP, CAT, HON, MCD, VZ, LUV, ETFC

I use strategies around earnings that are neutral-based, such as the Neutral calendar Spread, the Reverse Iron Condor, and the Straddle/Strangle. These are debit spread strategies that allow movement in either direction, and really, this is the ONLY way to trade earnings consistently and profit as it is a guessing game as to which direction a stock will move post-earnings, no matter how good or bad the results may be on a company’s quarterly report.

If you have any questions about these strategies or about trading stock options in general, feel free to e-mail me anytime at kmob79@gmail.com.

Thanks.

Free Earnings Trade of the Week: Square, Inc. (SQ) – Earnings/Long-Term Trade – Expires June 2016

Square, Inc. (SQ) is scheduled to report earnings after the markets close on Wednesday, 3/9/16.

This trade is both an earnings and long-term trade combo. It expires in June 2016. I have been meaning to buy some (SQ) calls for a while, and with earnings due after the bell today, see an opportunity here. Even if the stock should drop post-earnings, the time-value of this trade will hold value in these calls. If the stock should make a significant move upward, this trade has the potential to turn out extremely well. 9/10.

Entered Trade

Buy 10 SQ Jun16 11 Call


Requirements

Cost/Proceeds
$1,650.00
Option Requirement
$0.00
Total Requirements
$1,650.00
Estimated Commission
$15.00

NBBO
1.35 – 2.00. Try to pay 1.65 or less for this trade. At a maximum, pay up to 1.80. I will post the STC tomorrow before the opening bell.

Update 1: 3:55 pm EST. I I am in this trade at 1.65. Already a nice gain, could sell. But with this amount of time left, June exp. will keep it.
Update 2: 9:25 am EST 3/10/16 : Pre-market, the stock is up about $0.20/share. The earnings report was good, and I see this stock continuing to rise. With a lot of time-value left on this trade, I am placing the STC at $4.00 on the calls, as I see the stock heading towards $15.00/share in the near-term future. I will be updating this trade periodically if there are any changes to the STC.
Update 3: 3:34 pm EST 3/10/16: STC still at $4.00. The stock dropped a little bit, nothing significant. Should make a move upward soon. I do not recommend selling anything short of $3.00 if you do not plan to get $4.00.

Free Earnings Trade of the Week: Intuit Inc. (INTU) – Reports After the Markets Close on Thursday, 2/25/16

Intuit Inc. (INTU) is scheduled to report earnings after the markets close on Thursday, 2/25/16.

Last quarter, the stock had the following price movement after reporting earnings:

Nov 20, 2015

106.28
108.00
101.17
103.20
6,622,300
102.88


Nov 19, 2015

96.93
97.68
95.79
97.42
3,985,900
97.12

This stock has a history of initially making a somewhat large price move post-earnings, but then settles down to average a moderate move only. I am going to take advantage of this here, using a Neutral Calendar Spread. The current price to pay for this trade is excellent, especially on a higher-priced stock, if you can get it at my recommend price to pay for it. This trade has the potential to make a great ROI, and carries low risk, as it will retain value either way. 10/10.

Here is how the trade is placed:

Entered Trade

Sell -30 INTU Mar16 100 Call

Buy 30 INTU Apr16 100 Call


Requirements

Cost/Proceeds
$1,800.00
Option Requirement
$0.00
Total Requirements
$1,800.00
Estimated Commission
$90.00

NBBO
0.30 – 0.90. Try to pay 0.60 or less for this trade. At a maximum, pay up to 0.66.

See the attachment for the profit/loss chart.

I will post the price to close this trade out tomorrow morning, right before the opening bell.

INTU NCS 22516

Update 1: 9:25 am EST:
Pre-market, the stock isn’t moving much at all, ideal for the Neutral Calendar Spread strategy. I am placing the price to close this trade out at 1.80. I will update any changes to this here, if needed.

A Look Ahead To Earnings Next Week: 2/29/16 – 3/4/16

Here are the stocks I will be looking at to possibly trade next week for earnings. (Note: my earnings strategies are debit spreads that are neutral-based, such as the Neutral Calendar Spread, Reverse Iron Condor, Strangle/Straddle, and with occasional long positions placed). These strategies allow me to take a non-biased approach as to direction, where a trader can profit no matter which way the stocks moves after reporting earnings.

Monday:
BSFT,CROX, GLP, LL, WDAY

Tuesday:
BGFV, BOBE, DKS, DLTR, JKS, PGR, ROST, TIVO

Wednesday:
JOBS, COST, BREW

Thursday:
AVGO, BURL, CIEN, DMND, TFM, JOY, NMBL, PRFT, SWHC, SSI, KR, TSL, WING,

Friday: BIG

Very Busy Week for Earnings & Trading Opportunities, January 25 – 29, 2016

This week especially is loaded with earnings, so there should be plenty of trading opportunities. Among the stocks reporting earnings this week that I will to trade are the following:

AAPL, BABA, AMZN, PKG, PII, LMT, BA, DFS, FB, TXN, SWI, JNPR, JNJ, T, BBOX, COF, NVR, ABAX, PYPL, CAT, EA, HOG, LLL, MKC, MSFT, V, CVX, HON, MA, PX, STX,

Almost all of my earnings trades are neutral-based, meaning that I do not choose a specific direction. This allows a trader to profit regardless if the stock moves up or down post-earnings. Strategies that I like to use for earnings are the Neutral Calendar Spread, the Reverse Iron Condor, Strangle/Straddle, and occasionally the Long Put Butterfly Spread.

Next week should be very busy as well for earnings.

I am offering discounted subscription plans until January 31, 2016. If you have any questions, you can e-mail me at: kmob79@gmail.com

Free Earnings Trade of the Week: Netflix, Inc. (NFLX) – Reports After The Markets Close 1/19/16

Netflix, Inc. (NFLX) is scheduled to report earnings after the markets close on Tuesday, January 19, 2016.

Last quarter, the stock had the following price movement after reporting earnings:


Oct 15, 2015

103.77
104.88
99.10
101.09
48,484,300
101.09

Oct 14, 2015

111.50
111.63
108.05
110.23
33,231,500
110.23

NFLX has been a very volatile stock lately, it has been having up days on really down market days, and vice versa. I think this quarter, the stock is going to make a bigger than usual price move. However, I want to give myself some time on this trade so the Implied Volatility drop that happens post-earnings won’t effect the price of the options too much. I will be using a Strangle strategy with out-of-the-money options and March 2016 expiration dates. This provides a lot of time-value, and should the stock make a big move, up or down, this trade will do extremely well. Even if the stock makes only a $10.00 price move, I do not see the price of the options deteriorating much at all as they have almost 2 months until they expire. While this trade is not cheap to place (using 7 contracts only on each leg), there is not much risk overall. 9/10.

Here is how the trade is placed:

Entered Trade

Buy 7 NFLX Mar16 130 Call

Buy 7 NFLX Mar16 85 Put


Requirements

Cost/Proceeds
$4,480.00
Option Requirement
$0.00
Total Requirements
$4,480.00
Estimated Commission
$21.00

NBBO
6.30 – 6.55. Try to pay 6.45 or less for this trade. At a maximum, pay up to 6.55. I will post the STC orders tomorrow, right before the opening bell.

Update 1: 9:24 am EST
: After-hours yesterday, the stock made a big move, but is currently only up about $2.00/share, most likely due to the futures being down. I am placing the STC on the call side at $9.00, as the earnings report was very good, so expecting it to move back up. On the put side, place the STC at 7.00 for now. I will be updating this trade frequently here.

Update 2: STC on the puts at 9.00


Update 3: NFLX falling, place the STC on the puts at 11.00 now. Will continue updating as needed.

Update 4: 9:40 am EST. STC at 10.00 on the put side. STC at 7.00 on the call side.

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