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4-19-2013

 

Yesterdays green open was short lived, as the market sold off and actually broke the 153.80 area i was concerned about. The market did rally a bit from the lows but still finished in the red with some of the high fliers like LNKD, PCLN, and NFLX taking it on the chin while AAPL continued its downturn with the stock price nearly cut in half since Sept.

After hours we had earnings from CMG, GOOG, ISRG, IBM, and some others this morning like UA, and MCD. The only trade i had was on ISRG. The company handily beat expectation but their outlook for procedure growth was at the low end of expectations, allowing the bears to bring the stock down. May look to try for some lottos at the open. CMG beat estimates as well and the stock is up nearly 5% pre-market. GOOG beat on eps but was a little light on revenue and most analysts kept buy/outperform ratings on it.

 

With the market nearing support areas, I am becoming a bit more concerned of further downside, but I am still a short term bull here. Will just mean instead of looking for a bounce everyday, I will be more open to puts and downside plays. WIll talk more about it on the week ahead Sunday Night.

 

Here are some of the analyst changes today:

 

Apple price target raised to $890 from $830 at Canaccord

Shares are Buy rated.

CMG)

Chipotle price target raised to $460 from $435 at RW Baird

Baird raised its price target on Chipotle following better than expected Q1 results. The firm believes the company is well positioned to deliver solid earnings growth, robust returns on capital, in addition to a healthy balance sheet and cash flow. Shares are Outperform rated.

COF Capital One reported good Q1 results, says Oppenheimer

After Capital One reported higher than expected Q1 EPS partly due to reserve releases, Oppenheimer believes that the company's EPS was in-line, even excluding the reserve release and a $97M addition to the reps and warranties reserve. The firm keeps a $69 price target and Outperform rating on the shares.

AAPL Apple initiated with a Buy at Standpoint Research

Target $480.

GOOG Google Q1 core results solid, says RW Baird at RW Baird

Baird called Google's Q1 core results solid but noted its earnings beat was largely due to a lower tax rate. The firm also noted Motorola was a drag on margins and despite macro and European concerns the report was better than expected. Shares are Outperform rated with an $830 price target.

VRTX Vertex price target raised to $95 from $65 at Needham

Needham raised its price target for Vertex citing the positive Phase 2 results for the company's second corrector compound, VX-661. The firm reiterates a Buy rating on the stock.

GOOG Google price target raised to $900 from $850 at Needham

Needham raised its price target for Google shares to $900 following the company's Q1 results and reiterates a Buy rating on the stock.

GOOG Google price target raised to $915 from $830 at Citigroup

Citigroup raised its price target for Google shares and says the stock's valuation is reasonable following the company's Q1 results. Citi reiterates a Buy rating on the stock.

 

With option expiration day today, we can see some Pins, meaning AAPL and GOOG will most likely close at even strikes for Max Pain. AAPL 380 and GOOG 770 or 760 is where I would guess right now.

Will play a few lottos today as well as grabbing my position for NFLX earnings next week. Here is what i am watching:

 

 

Stock Ticker Call/Put Strike Expiration Closing Price Entry Price
NFLX CALL $235.00 April (27) 0.45 0.40
NFLX CALL $255.00 May 0.37 0.35
CMG CALL $350.00 weekly 8 0.50
AAPL PUT $380.00 weekly 0.73 0.40

 

 

Also, will be sending out a ‘Test” text alert today to ensure everyone is getting them. Will follow up with a blog post later today to follow up. Lets have a great end to the week!

 

- JB

4-18-2013 Watch List

 

So much for “Buy the Dip” yesterday as the market was in full sell-off mode and erased all the gains from Tuesday. Futures are currently green but it would not be surprising to see those gains vanish through the day. Jobless claims came out this morning and were inline. Also had earnings from AXP, SNDK, and EBAY yesterday. All three were down yesterday with SNDK down over 10% at some points, but has since recovered to be green at the moment as well as AXP. TZOO reported earnings this morning that beat expectations on both ends and is up over 10% pre-market. They have a conference call at 11am so that may either help add or subtract from it’s current  gain.

 

After the bell today we have some of the more notable earnings reports, and the ones I am more interested in with CMG, ISRG, and GOOG.

 

Here are some of the analyst changes for today:

 

SNDK SanDisk price target raised to $77 from $70 at Susquehanna

Susquehanna raised its price target on SanDisk following better than expected Q1 results. The firm cited margin expansion, strong free cash flow, better revenue streams, and the belief the company has gained market share in China. Shares are Positive rated

SNDK SanDisk price target raised to $75 from $55 at Credit Suisse

Credit Suisse said SanDisk's Q1 report was solid and views as conservative. The firm notes that Sandisk will not add wafer capacity in 2013 and maintained its capex, providing a favorable backdrop for shares. Shares are Outperform rated.

AAPL Apple medium-term risk/reward appears favorable, says Pacific Crest

Pacific Crest expects Apple's Q2 and Q3 results to meet buyside expectations,and the firm thinks that such results could drive the stock higher. The firm remains uninspired by the company's longer term outlook, however, and maintains a Sector Perform rating on the shares.

 

AAPL Apple valuation decline could reverse, says JPMorgan

JPMorgan believes the deterioration in Apple's valuation could reverse as the risk-on trade eases. The firm attributes the sharp pullback in shares to concerns around revenue deceleration, increasing competition, gross margin deterioration, and a lack of product catalysts. JPMorgan thinks consensus estimates for Apple could move higher through 2013 and keeps an Overweight rating on the stock with a $725 price target.

AKAM Akamai has limited upside, says Morgan Stanley

Morgan Stanley expects Akamai's Q1 to be in-line but sees incremental risk to Q2 guidance and decelerating FY13 growth. The firm sees limited upside to shares and maintains its Equal Weight rating.

SCSS Select Comfort reinstated with an Outperform at Raymond James

Target $21.

EBAY)

eBay shares should be bought at current levels, says Stifel

After eBay lowered its Q2 guidance partly due to macro concerns, Stifel expects macro worries to weigh on the stock in the near-term. The firm, however, thinks that the company can still meet its three year guidance.

 

I will be trying ISRG calls today for possible large upside after earnings. I am not as sure about GOOG and CMG but may try for some lottos as well. We have all seen what can happen being in on some small positions into earnings, so all three below are EXTREMELY risky with the odds that they all expire worthless on friday VERY high so please treat with caution, as you should with ANY options trade:

 

 

Stock Ticker Call/Put Strike Expiration Closing Price Entry Price
ISRG CALL $590.00 weekly 0.25 0.25
GOOG CALL $880.00 weekly 0.35 0.30
CMG CALL $405.00 weekly 0.30 0.30

 

 

 

Lets have a great day!

 

- JB

4-17-2013 Watch List

 

We had a strong broad-based rally yesterday, as folks bought the dip from Monday and commods started to get a bid. We had earnings from YHOO and INTC last night that weren’t as strong as folks were expecting, and both are down pre-market. BAC reported this morning with weaker results as well.

Futures were already down quite a bit overnight on a Europe sell-off, as fears of a China slow down are giving folks a reason to take some profits.

 

Yesterdays rally pushed us above any  concern levels on the $SPY.. for the moment. Right now the 50DMA on the $SPY is $153.80, if we head to that level and break below in the next few days, I may start to change my Bullish sentiment. For now we are still in ‘Buy the Dip’ mode.

 

Here are some of the analyst changes from today:

 

YHOO Yahoo upgraded at BofA/Merrill

As previously reported, Bofa/Merrill upgraded Yahoo! to Buy from Neutral. The firm upgraded shares based on favorable risk/reward. Price target is $28.

CRUS Cirrus Logic downgraded to Buy from Strong Buy at Needham

Needham downgraded Cirrus citing the disappointing Q4 pre-announcment and Q1 guidance. Price target is $30.

WDAY Workday initiated with an Outperform at Wedbush

Target $76.

CAT Caterpillar downgraded at Macquarie

As previously reported, Macquarie downgraded Caterpillar to Neutral from Outperform. The firm believes Caterpillar could cut guidance given slowing macro momentum and notes the continued drag from China and greater than expected declines in mining capex. Price target lowered to $88 from $112.
DE Deere  downgraded to Neutral from Outperform at Macquarie As previously reported, Macquarie downgraded Deere to Neutral from Outperform. The firm downgraded shares following a reduction in its corn price forecasts, which is expected to result in lower equipment demand. Price target is $95.

INTC Intel bullish outlook maintained, says RW Baird

Baird maintains its bullish outlook on Intel citing touchscreen notebook demand, a recovery in enterprise, and strong growth in high end computing. The firm sees the potential for revenue upside if an economic recovery takes place. Shares are Outperform rated with a $26 price target.

MON Monsanto recommended at Morgan Stanley

Following trip to Brazil, Morgan Stanley said it has increased confidence in Brazilian farmers interest in Intacta soybeans and their willingness to pay for it given successful field tests. The firm rates Monsanto an Overweight with a $125 price target.


 

I didn’t purchase any positions from yesterdays watchlist, although the $LNKD $185 calls did go from $.50 to $1.59. Will look to enter some of the earning plays for tomorrow as well as looking at OPEN again. LNKD looks strong and will wait to see if it dips before getting in some calls today, as I said monday I think this breaks all-time highs this week. Also think OPEN pullback is unwarranted based on the JPM downgrade, and will look for some calls again. ISRG reports tomorrow after hours so will look again to grab a position today as well as TZOO for the earnings before the bell tomorrow.

 

Here are the strikes I am looking at:

 

 

Stock Ticker Call/Put Strike Expiration Closing Price Entry Price
ISRG CALL $580.00 weekly 0.65 0.60
LNKD CALL $190.00 weekly 0.52 0.35
WYNN CALL $130.00 weekly 0.51 0.30
TZOO CALL $25.00 May 0.35 0.35

 

 

Lets have a great day!

 

- JB

4-16-2013 Watch List

 

The markets started red and sold off on China growth fears as well as concerns over possible margin calls due to the 20% decline in gold since last thursday. The sell-off in equities gained steam as news of the tragedy in Boston hit the wires. I am still a short term bull as nothing really has changed in my opinion and the sell-off in commodities may provide fuel for the next leg as folks continue to look to get a return on their investment, and U.S. equities continues to look like the place to be.

 

Looks like the raise in margin requirements for Gold/Silver/Copper by CME is not having too much effect now on the commods and they are all bouncing nicely pre-market. I still think the trend is down but you can never rule out a bounce, especially with the move we have had to the downside.

BLK, GS, and KO all reported some nice numbers this morning, which may help support  any rally here today.

We have some more earnings this week with CMG, ISRG, and TZOO (ones i like) and will look to get in some positions maybe today or tomorrow.

 

Today may be volatile but i think we close in the green, barring any unforeseen events or news. “Black Swan’ events can really take the market by storm, so that is what i am worried about for the next few days. Hopefully yesterdays event remains an isolated one, and things return to normal.

 

By the way, folks in chat posted the news yesterday and I could not find it anywhere on TV..ect. 5 minutes later itr was finally on CNN, so not only do we have the best traders in the room, we have the best NEWSROOM! Thanks everyone for their contributions!

 

Here are some of the analyst changes this morning:

 

 

Apple Q1 likely at low end of guidance, says Jefferies
Jefferies says Apple will likely report Q1 results at the low end of its guidance while the consensus estimates for Q2 have substantial downside. After a trip to Asia, Jefferies believes the low-cost iPhone launch could be pushed to Q4 while the iPhone 6 will not launch until 2014. The firm keeps a Hold rating on Apple shares with a $420 price target. :theflyonthewal

 

Apple price target lowered to $600 from $650 at Stifel
Stifel significantly reduced its iPhone sales estimates for Q2 and Q3, but the firm still thinks that Apple will have several positive catalysts in 2H13, including increased China iPhone sales, the launch of a low-end iPhone, and the iPhone 5S launch.Stifel keeps a Buy rating on the stock. :theflyo

 

Microsoft upgraded to Overweight from Equal Weight at Morgan Stanley
Morgan Stanley assumed coverage on Microsoft with an Overweight rating from an Equal Weight rating. The firm believes Microsoft risk/reward is attractive and sentiment overly negative due to weak PC data and Windows 8 launch. The firm believes shares will move higher driven by improving PC trends, the upcoming Blue release, touch screen ramps, and its broadening cloud exposure. Price target is $36

 

  Costco initiated with a Buy at UBS
Target $121. :theflyon

 

Boeing price target raised to $115 from $87 at Jefferies
Jefferies raised its price target for Boeing shares citing the company's large backlog and productivity initiatives. The firm sees Boeing's earnings growing through 2016 and keeps a Buy rating on the stock. :theflyon

 

Baidu continues to lose market share, says Maxim
Maxim believes Baidu continues to lose market share to competitors after internet data collector CNZZ reported the company's traffic share declined from 71.7% in December 2012 to 70.3% in March. Maxim lowered its price target for Baidu shares to $75 from $80 and keeps a Sell rating on the stock. :theflyon

 

C Citigroup results bode well for future, says Wells Fargo

After Citigroup reported higher than expected Q1 EPS, Wells Fargo believes that the company is benefiting from improving mortgage trends. The firm thinks the results increase the chances that the company will report higher profitability in 2H13 and return more capital to investors in 2014. The firm keeps an Outperform rating on the shares.

 

I bought SAM, NFLX, PCLN, and MLNX calls yesterday and still hold them. WIll look to grab more LNKD calls, ISRG calls for earnings, and possibly OPEN calls.

 

Here are the strikes I am looking at:

 

 

Stock Ticker Call/Put Strike Expiration Closing Price Entry Price
ISRG CALL $580.00 weekly 0.65 0.60
LNKD CALL $185.00 weekly 0.53 0.50
OPEN CALL $60.00 weekly 0.30 0.30

 

 

I still love SAM here and chart looks set to break over $160 and test the triple top at $164. If it breaks that, $170 may come this week and the 170 calls maybe a possible lotto.

 

Lets have a great day and make sure our thoughts and prayers go out to the folks in Boston.

 

- JB

4-15-2013

 

Another great week as the market had it’s third best percentage gain this year. There were also some huge moves on high beta names, an option traders wet dream. PCLN, CMG, LNKD, and ISRG all had some nice moves along with the surprise move in FSLR and the huge drop in Gold and Silver friday. Overnight, commodities continued to take it on the chin with Silver dropping over 10% and Gold over 7%, on top of the steep declines last week. Of course they will bounce at some point, but sometimes timing a falling knife can get you cut.

Earnings really heat up this week with some big names reporting. UPB spoke about a few of them last night on the week ahead, and I will be adding some on the watchlist webinar tomorrow: https://www.optionmillionaires.com/2013/morning-watch-list-and-q-a-with-jb-745am-friday-4-12/

 

Here is the Week Ahead Webinar from last night:

 

https://www.optionmillionaires.com/forum/showthread.php/389-The-Week-Ahead-with-UPB-and-JB-4-14-2013

 

Here are some of the analyst changes this morning:

 

BTIG Research initiates coverage on Netflix, Inc. (NASDAQ: NFLX) with a Buy rating and a $250.00 price target.

UA Under Armour upgraded to Positive from Neutral at Susquehanna

As previously reported, Susquehanna upgraded Under Armour to Positive from Neutral. The firm believes growth remains intact and that investment spending and the June analyst meeting could act as catalysts for shares. Price target raised to $68 from $53.

UA Under Armour upgraded to Buy from Neutral at DA Davidson

DA Davidson upgraded Under Armour as the firm is confident that the company can gradually increase its full year guidance on the strength of numerous near-term growth drivers. Target to $66 from $57

VMW)

VMware checks indicate upside, says UBS UBS said Q1 channel checks indicate licensing revenue upside with a very strong close to the quarter. The firm rates shares a Buy with a $115 price target.

AAPL Apple near-term fundamentals mediocre but long-term positive, says UBS

UBS said Apple supply chain checks indicate near-term fundamentals are mediocre and that there is possible delays in new products. The firm believes Street estimates have further to fall but expects new product and services introductions, combined with additional carriers to act as catalysts later in the year. Shares are Buy rated with a $560 price target

PCLN priceline.com risks exaggerated by Barron's, says RBC Capital

After Barron's published a negative article about priceline.com, RBC Capital believes that each of the risks highlighted by the article is exaggerated or non-existent. The firm thinks the company has several positive catalysts and it keeps an Outperform rating on the shares.

CMG Chipotle upgraded to Outperform from Neutral at Wedbush

CMG Chipotle upgraded to Buy from Neutral at UBS

UBS believes Chipotle sales trends ended positive and that Q1 same-stores-sales growth will improve sentiment. The firm expects Chipotle sales and profits to accelerate over the next 18 months and upgraded shares to Buy with a $390 price target, raised from $330.

 

GOOG Google initiated with a Buy at Topeka

Target $950.

TRIP TripAdvisor price target raised to $62 from $45 at Piper Jaffray

Piper Jaffray raised its estimates and price target for TripAdvisor on expectations the company's transition to metasearch will result in improved user experience and monetization. The firm keeps an Overweight rating on the stock.

 

Will be playing some of the high beta names for continuation from friday, especially with a downward gap this morning. LNKD, NFLX, and PCLN for bounces as well as trying to get some SAM calls to add to my 170/180 strikes.

 

Here are the strikes I am watching at open:

 

 

Stock Ticker Call/Put Strike Expiration Closing Price Entry Price
PCLN CALL $780.00 weekly 1.20 0.60
LNKD CALL $200.00 weekly 0.49 0.40
NFLX CALL $195.00 weekly 0.42 0.40
SAM CALL $165.00 weekly .15 x .45 0.25

 

 

Think LNKD breaks over $190 this week and PCLN heads towards $800 so will play accordingly. PCLN calls are too expensive so will wait to see if they come down before trying to enter.  Like NFLX to break out on this upgrade this morning and love SAM. Will post entries in chat/twitter.

 

Lets have a great day!

SPECIAL MESSAGE for United States OM MEMBERS : DONT FORGET TO PAY UNCLE SAM!!!!!!!!!! 

 

- JB