$EBIX Update

unusual options trades and unusual options volume

$EBIX hit fresh record highs yesterday after releasing a strong earnings report.

My March $60 calls went from the $.90 early February price to $4.00 yesterday, with two weeks left until expiration.

Barring a complete collapse of the equity market, Ithink $EBIX is poised for a breakout year in 2017, and for the same reasons I highlighted in my previous piece  nearly a month ago.

$EBIX for Upside

Very simply:

  • Earnings continue to grow.
  • Outstanding Shares Continue to Shrink

Analyst commentary on the name as well this morning:

Ebix price target raised to $75 from $68 at Craig-Hallum
Craig-Hallum analyst Jeff Van Rhee raised his price target for Ebix to $75 from $68 after the company put up "another strong quarter," beating top and bottom line by a wide margin and posting "tremendous" free cash flow. The analyst continues to see a "very long runway" in front of the company to continue running the same playbook. He reiterates a Buy rating on the shares



With the company set to embark on a $150 million share buyback, investors looking to take a position in $EBIX will be facing a tighter supply of available shares.

Also some 28% of the current float is short.  When $EBIX hit a new all time record high yesterday  100% of the short positions in $EBIX were facing a loss.  As the stock continues to head higher, we could see shorts cover their losing positions.  This could also increase the demand for $EBIX amid a shrinking supply.

$EBIX has already reduced it's outstanding shares some 20% the last few years.  The recent share buyback could shrink the outstanding count by almost another 8%.

While I can not say for certain where $EBIX will trade today or tomorrow, I do think longer term it will continue to trade higher, and I will position for that move accordingly.


Known to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

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