All posts by jimmybob

OpenTable, Inc (OPEN)

OpenTable

 

We were bullish on OpenTable, Inc (OPEN) back on December 10th, as the chart showed signs of a potential breakout from $46.21. In little more then a month, the stock climbed over 20% hitting $55.95 on January 25th. See the chart below for our original call:

open 12-10

 

Since then, OpenTable, Inc (OPEN) has channeled in a tight range as folks look for catalysts to fuel the next surge or fade. Yesterday Raymond James downgraded OpenTable (OPEN) from Outperform to Market Perform. The stock sold off on the news, but found footing and settled above $54. We think OpenTable, Inc (OPEN) is ready to break out of its current trading channel and test $60 in the next few weeks.

OpenTable, Inc (OPEN) was once trading over $100 and on top of the world. A world that came crashing down as growth concerns scared investors. We now think the stock looks very attractive. It's forward P/E ratio is under 30, the company is debt free, generating nice cash flow, and continues to show strong double digit growth.

Any frequent diner will tell you how entrenched OpenTable, Inc (OPEN) seems to be, and with a 1.2 bil marketcap, it would not be a stretch to think it is a buy out candidate. With some more upside on the stock possible, and the days of easy money ending, one would have to think something would happen very soon.

We currently hold March 55/60 calls and may add or sell our position at any time.

OPEN 2-22

 

 

2-22-2013 Watch List

 

Yesterday saw some follow through on the large sell off we had on Wednesday. The SPY broke down under $150 mid-day, only to rally near the close. I posted a piece on the VIX mid-day : https://www.optionmillionaires.com/2013/in-vix-we-trust/ . I have also spoken about this a few times on the week ahead, and on audio in the chatroom. The VIX will slide under that upper bollie, and sometimes signals a reversal.

If you look at the SPY chart, we are way above 50 and 200 dma, so a pullback is not unexpected. Playing bounces like we will have today, can equal big returns.

 

FLS  and AIG reported after the close with AIG beating estimates even with Sandy problems. AIG is the new “APPLE” for hedge funds and is the #1 holding as per the last Q filings. FSL beat, raised divy, and announced a 3 for 1 split. Not sure if/or how high she may run, but may watch at open. That stock is near all-time highs but has a tendency to move quick after the open.

 

ANF reported an EPS beat this morning, but missed revenue and sounds cautious. The stock was up PM, but is now red and down nearly $3.

 

Here is a nice read/video on the currency wars courtesy of Lavender :

http://finance.yahoo.com/blogs/daily-ticker/currency-wars-lead-world-war-gerald-celente-182722765.html?desktop_view_default=true

 

ISRG has a huge upgrade from Goldman this morning, giving the finger to CITRON who  said the stock should be $300 while Goldman raised target to 715 from 591. I was looking yesterday after the Citron update and still thought calls were too pricey and spreads to large to get a nice fill. Will take a quick look at open to see if I can grab any 630 or so calls.

 

The rest of the analyst changes:

 

Intuitive Surgical upgraded to Buy from Neutral at Goldman

Goldman upgraded Intuitive Surgical and believes general surgery uptake will be the next leg of growth as surgical robotics evolves. The firm said the new da Vinci, upgrades, and add-ons will accelerate growth and that there is potential for management to return excess cash to shareholders. Price target raised to $715 from $591

Hewlett-Packard upgraded to Neutral from Sell at UBS

UBS upgraded Hewlett-Packard citing improving free cash flow and reasonable valuation. Price target is $19.

(CAT)

Caterpillar upgraded to Outperform from Market Perform at Raymond James

(AGU+)

Fertilizer Industry downgraded to a cautious stance at Dahlman Rose

Dahlman Rose downgraded the fertilizer sector given negative fundamentals going forward driven by crop and capacity issues. The firm sees substantial

 

pressure on nutrients pricing in 1H 2013 with nitrogen having the greatest long-term margin risk given capacity additions. As a result, the firm downgraded Agrium (AGU), CF Industries (CF), and Rentech Nitrogen (RNF) to Sell from Buy, Mosaic (MOS) to Hold from Buy, and Potash (POT) to Sell from Hold.

 

Visa upgraded to Buy from Neutral at Guggenheim

 

 

Here are some of the strikes I am looking at for flips today. They are all weekly and EXTREMELY risky. Already hold PCLN 700/705 and GOOG 815

 

 

Stock Ticker Call/Put Strike
GOOG CALL $810.00
GOOG CALL $815.00
PCLN CALL $695.00
PCLN CALL $700.00
MA CALL $525.00

 

 

I will wait to see what FLS looks like before getting in, those are monthly. If the market ramps the rest of the day, PCLN and GOOG should break. PCLN has earnings next tuesday and bounced off lower bollie yesterday, meaning she should bounce anyway.

 

Lets finish this shorted week in style!

 

- JB

 

In VIX we Trust

 

The VIX is currently over the upper bollinger band as 'fear' has risen in the market over the past two sessions. Every time this has occurred over the past few years, there has been a rally in the subsequent trading sessions. Not saying this rally happens now, tomorrow, or Monday. But conditions causing the VIX to cross over the upper bollinger band will resolve themselves, meaning the VIX is going to drop.

$VIX 2-21

2-21-2013 Watch list

 

 

Well we had our worst day of 2013 yesterday, as folks used the FOMC minutes and Italy concerns as a reason to take some profits. The BEAR headlines continue as the folks at Marketwatch put this article as a headline this morning : http://www.marketwatch.com/story/3-lessons-of-the-upcoming-anniversary-2013-02-21?dist=beforebell

 

Jobless claims numbers came out this morning 20k above expectations. Futures are slightly red. Today can go either way, but I think folks will continue to do as they have done for the last few months.. buy the dip. We shall see. WMT numbers out this morning not as bad as folks were expecting from fridays leaked email so the stock is up pre-market.

 

Rough day yesterday for SINA and SODA. SINA didn’t run as far as i would have liked, and SODA pulled the typical fade on earnings even after beating estimates by huge margins, and raising its outlook once again. 3 Analysts are out this morning on SODA with bullish comments. We have the March 57.50/60/65 calls as well as some April and like SODA to break into all time highs in the next few days.

 

SAM earnings were somewhat in line, with FY 13 outlook coming in within expectations. We sold all our March calls and hold April calls. Based on the run up, Its possible SAM may fade here today, but I have a feeling it will be back over $160 in good time. SAM has a history of raising its outlook, and wouldnt be surprised to see it happen when there is more clarity on how the Sam in a Can will effect numbers.

 

I also like OPEN and SHLD for the next week or two and hold calls.

 

Here are some of the analyst changes today:

 

)

Wal-Mart lowers FY14 sales growth view to 5%-6% from 5%-7%

The company said, "Given the continued soft global economic environment, we believe our sales growth will be similar to what we experienced in fiscal 2013, somewhere between 5.0%-6.0%." In October, forecast net sales, excluding acquisitions and currency exchange rate fluctuations, would increase 5%-7%. Says continues to see progress toward goal of reducing operating expenses as a percentage of sales by at least 100 basis points over the next five years, noting it delivered 14 basis points of leverage in FY13. Says all guidance considers the costs company incurring in response to FCPA and compliance matters. Sees these costs to be approximately $40M-$45M for Q1

(SODA)

SodaStream weakness creates buying opportunity, says Oppenheimer

After SodaStream reported stronger than expected Q4 results, Oppenheimer is encouraged by the company's 2013 guidance and recommends that long-term investors use yesterday's weakness to buy the shares. The firm reiterates a $60 price target and Outperform rating on the stock.

(GOOG)

Google price target raised to $1000 from $820 at Bernstein

Bernstein expects Google to benefit from "connecting everyone, everywhere." The firm thinks the stock's risk/return ratio is highly attractive, and it reiterates an Outperform rating.

Capital One multiple still poised to increase, says Bernstein

After Capital One reported weaker than expected Q4 results and sold its Best Buy (BBY) card loans, Bernstein still believes that Capital One's valuation is "outstanding." The firm expects the company to be boosted by deposit-funded growth and it maintains an Outperform rating.

SodaStream price target raised to $56 from $50 at Deutsche Bank

Deutsche Bank raised its price target for SodaStream following the company's Q4 results and maintains a Buy rating on the stock.

SodaStream sell-off overdone, says Barclays

Barclays said SodaStream's Q4 report was strong and guidance was impressive. The firm is positive on management's focus on brand awareness and increasing consumer and household share. The firm views weakness as overdone and reiterates its Overweight rating and $55 price target.

Nike upgraded to Buy from Neutral at Citigroup

Citigroup upgraded Nike citing stabilizing trends in China, potential stabilization in Europe and valuation. The firm raised its price target for shares to $62 from $51.

 

 

Holding quite a few positions but here are some I am looking at for today:

 

 

Stock Ticker Call/Put Strike Expiration Closing Price Entry Price
GOOG CALL $810.00 weekly 0.60 0.50
GOOG CALL $815.00 weekly 0.30 0.25
FLS CALL $175.00 March 0.55 0.50
ANF CALL $60.00 March 0.32 0.28

 

 

GOOG had some upgrades to $1000, so if the market gets some legs today, the 810/815 calls may offer a nice risk v reward scenario. FLS reports after hours and has the possibility to continue to break to new highs. Lots of folks are very bullish on ANF and a nice beat tomorrow will propel the stock to near 60.

 

As you can see, earnings can be a crapshoot so please follow at your own risk into any of these.

 

Lets have a great day!

 

- JImmybob

2-20-2013 Watch List

 

Another day, another multi-year high for the markets. The Nasdaq closed at a 12 year high, while the SPY and DOW hit 5 year highs. GOOG crossed 800 and looks to be the first stock to near the 1k barrier from the group of PCLN and AAPL. Yes, AAPL had a shot at one point. News about hiring freeze at Foxconn due to slower Iphone 5 production has AAPL down once again pre-market.

 

We had earnings reports from HLF and SINA after hours. HLF beat and raised its outlook, and there are a some upgrades this morning. But looks like folks are still conerned about a possible investigation so the stock is off a bit pre-market. The Kind of move that will probably kill premiums on both ends for option traders. SINA reported a great Q with outlook that was somewhat inline. Seems most of the Analysts like what they saw and the stock is up nicely pre-market.

 

SODA reported another blowout quarter with raised outlook, but the stock is down pre-market like usual. I would bet the shorts lose this battle, and the stock opens near green, and heads to 55+ today.

SAM had a great day yesterday, a day I have been waiting for. SAM reports earnings after the bell today so hopefully the shorts will continue to run her higher.

I added 165 calls in the ditto account and closed some yesterday. Will look to close some more before the close as it is too risky to hold all over night.

 

Below are the analyst changes of note for today:

 

 

SINA Q1 guidance positive, says Piper Jaffray

After SINA provided in-line Q1 revenue guidance, Piper Jaffray believes that the momentum of the company's Weibo microblog is continuing while the Chinese Internet ad environment appears to be improving. The firm thinks that SINA's ad revenue guidance likely beat Street expectations, and it maintains a $65 price target and Overweight rating on the shares.

Baidu downgraded to Underperform from Outperform at CLSA

CLSA downgraded Baidu citing increased competition from Alibaba's new search engine, increased investments from the shift towards smartphones, and slowing earnings growth. Price target is $105.

SINA turning corner on Weibo, says Stifel Nicolaus

After SINA reported stronger than expected Q4 results, Stifel Nicolaus expects its Weibo microblog to generate an operating profit by Q4. The firm increased its price target on the stock to $80 from $70 and maintains a Buy rating.

Barclays Maintains Overweight on Sina Corporation, Lowers PT to $69.00

SINA reported solid Q4 results, says Brean Capital

Brean Capital remains positive on SINA following solid Q4 results. The firm noted the company is focusing on mobile which is its high growth and high penetration area and views Weibo as an attractive strategic target for the mobile internet space. Shares are Outperform rated with a $69 price target

 

 

We currently hold NFLX 215 Calls/ BPT 85 calls, /SAM 165 calls, /SHLD 57.92 calls /SODA mar 65 and apr 70 calls/DNKN Mar 42.50 / OPEN Mar 65C /

 

I am having issues with my buying power on ditto so there will be no trades in the morning. Here are the two strikes I am look at this morning:

 

 

Stock Ticker Call/Put Strike Expiration Closing Price Entry Price
SINA CALL $62.50 weekly 0.31 0.30
SODA CALL $65.00 March 0.36 0.20

 

 

Also, here is my take on SAM last night : https://www.optionmillionaires.com/2013/boston-beer-sam-breaking-out-into-q4-earnings/

 

Lets have a great trading day!

 

- jimmybob