October 19th, 2022 Watch List

Markets rallied for the second session in a row, with the S&P adding another 1.14% on Tuesday. Asia markets closed mixed overnight while Europe indexes are mostly lower this morning. U.S. futures are pointing to a lower open as I write this, the Dollar, Yields, and Oil are higher while Gold is lower.

And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-121/

Stocks rallied again yesterday, as the Q3 earnings season kicks into high gear, and companies are reported some relief reports that have been better than expected. After the close yesterday, NFLX reported a beat and raise. The company bested its subscriber add estimate and also raised its subscriber add guidance for Q4... a sigh of relief. ISRG, another beaten down name, also reported a great Q. Who knows if this is a sign of things to come this earnings season, but certainly can be construed as a positive. Not going to sit here and call a bottom, but do think there will be some playable bounces on earnings in some names. Will cover potential candidates in the coming days and this weekend as I may start to look at some speculative lotto calls in some names.

The SPY closed in no-mans land above $370, Would want to see that $380 test and break as outlined yesterday and maybe the $400s can come in play in the coming weeks. If we fall back into the $360s fear this bounce is short lived and the $350s come back in play:

I closed the last of my NFLX calls yesterday for some profits. Did not want to take the risk on into earnings. If NFLX opens in the $270s, those calls will likely be in the red so turned out to be the right move. I actually may trade NFLX for a move to $280 or so into Friday depending on how much the calls are:

ROKU closed up over 1% yesterday and is gapping higher this morning on the heels of NFLX's earnings. Would think my calls open up 50% higher or so. If ROKU breaks and hold $55 will hold the calls for a potential move up into the $60s. If not, will look to take the profits and revisit:

GNRC issued preliminary numbers for their Q3 report coming out in November and it came in well below expectations. The stock is getting punished in the premarket and thankful I did not add any strikes. Will likely take off the watchlist for now and revisit.

ZYME and JAZZ announced a licensing deal. Just another notch in ZYME's belt. Still boggles my mind it trades down here. I may look at some leaps today to play for an eventual move back over $10:

Still eyeing some SPOT and TWLO calls.

SPOT for a move over $90:

And TWLO for a move over $75 or so once it breaks that 50dma:

If the SPY reverses today and can't hold $366 or so on the SPY, will look at some TZA calls for a hedge.

Here are the analyst changes of note for today:

Microsoft price target lowered to $282 from $300 at Citi
Citi analyst Tyler Radke lowered the firm's price target on Microsoft to $282 from $300 and keeps a Buy rating on the shares. Currency and PC headwinds are likely to impact the company's fiscal Q1 results and may drive reported results below consensus again, Radke tells investors in a research note. That said, the analyst's reseller survey and partner checks give him confidence that enterprise demand for Microsoft is holding up well, with record partner quota/accelerator achievement levels and incremental signs of Azure demand strength. He expects Microsoft to show more resilient growth trends versus peers
Twilio price target lowered to $94 from $170 at UBS
UBS analyst Taylor McGinnis lowered the firm's price target on Twilio to $94 from $170 but keeps a Buy rating on the shares. ahead of the company's Analyst Day and Q3 results on November 3rd. The analyst states that her channel checks were more cautious on Twilio demand, though she believes that at 2-times enterprise value to expected 2023 revenue, the stock already reflects the challenged growth and margins
Deutsche Bank upgrades Netflix to Buy on sub growth inflection
Deutsche Bank analyst Bryan Kraft upgraded Netflix to Buy from Hold with a price target of $350, up from $270, following last night's results. The analyst now sees visibility into a subscriber growth inflection point next year given that Netflix management has confirmed both the early 2023 introduction of its new measures designed to better monetize account sharing, and the early November timing of its advertising-based video on demand tier launch in 12 top markets. The 100M "account borrowers" Netflix has counted represent a clear and present growth opportunity that Netflix will soon be in a position to exploit, Kraft tells investors in a research note
Netflix price target raised to $235 from $170 at Barclays
Barclays analyst Kannan Venkateshwar raised the firm's price target on Netflix to $235 from $170 and keeps an Equal Weight rating on the shares. The Q3 results should "alleviate some of the worst case scenarios," but further upside realization may need more concrete data points on advertising and success in password sharing clampdown, Venkateshwar tells investors in a research note. The analyst says Netflix delivered results for Q3 and Q4 sub growth guidance that was better than consensus estimates
Goldman Sachs price target lowered to $477 from $483 at Oppenheimer
Oppenheimer analyst Chris Kotowski lowered the firm's price target on Goldman Sachs to $477 from $483 and keeps an Outperform rating on the shares. The analyst notes Goldman printed Q3 results that were about as "in line as you could ever hope to get," with EPS coming in at $8.25 versus his $8.18 estimate and the consensus' $7.75. Kotowsi suspects that the investment banking "window" will open at some point in 2023 as historically, it doesn't stay shut for years on end. However, what he is most pleased with - both for Goldman and the industry - is the absence of negative surprises
Morgan Stanley expects Apple to beat Q4 expectations, guide 'constructively'
Morgan Stanley analyst Erik Woodring views the setup into Apple's September quarter earnings report next week as "constructive," telling investors that he expects Apple to beat September quarter expectations and "guide constructively" on the December quarter. However, he does not believe the earnings report will put to rest investor concerns about a hardware downturn, added Woodring, who keeps an Overweight rating and $177 price target on Apple shares

Wix.com price target lowered to $81 from $89 at Morgan Stanley
Morgan Stanley analyst Elizabeth Porter lowered the firm's price target on Wix.com to $81 from $89 and keeps an Equal Weight rating on the shares. Software valuations are near trough levels and multiples in the group suggest significant risk related to budget revisions, macro and currency headwinds is priced in, said Porter and the firm's software team. They expect narrower beats in Q3 and more cautious Q4 guidance to provide an opportunity to start de-risking calendar 2023 estimates, they tell investors in North American Software group preview note

And here is what I am watching today: ZYME, GWW, ROKU, SPOT, TWLO, U, CMG, ISRG, WING, TZA, and IBM.

Let's have a great day!


JimmyBob (Scott)has been trading equities for over 15 years, a majority of which were OTC micro-cap stocks. He started trading high risk stock options over the past 7 years, and has proven winning trades in excess of 15,000%.

As one of the Co-Founders of optionmillionaires.com, Scott enjoys sharing his knowledge with other investors through timely blog posts, daily watch lists in the forum, weekly webinars, and helpful advice within the chatroom.

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