Tag Archives: LNKD

Where is the market headed tomorrow?

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Most daytraders close out their positions before the close. Making a living trading stocks is all about controlling your risks, and obviously there is more risk when you hold an equity overnight. Who knows what type of news can come out before the market opens that may impact your holdings. Better to lock-in the gain or loss before the close, and wait for the next trading day. That is, unless you are an option trader. Why? Well some of the most Epic moves come from holding a position over a few days.

Lets use todays move on LinkedIn(LNKD) as an example.

Stocks like LinkedIn (LNKD) are susceptible to volatile moves which is caused by the varying opinions of the 'proper' valuation of the stock. There are those who think a stock with a P/E ratio of 800 is a bubble and then the ones with the foresight(like myself) who are more forward looking, and think LinkedIn (LNKD) is undervalued. Bulls and bears squared off today. With Greece grabbing the headlines again (puke) causing a market sell off, LinkedIn(LNKD) fell over 8% to $101.53.

Its at that moment when option traders start to salivate. Not more then 3 trading days ago, LinkedIn (LNKD) traded over $120, now it sat almost 20% off its highs. CALLS! Buying the calls today at that moment would have resulted in some huge returns. But it those who hold for another day or two that may reap the big rewards. Take a look at the possible return today on the LinkedIn (LNKD) $11o calls. $550 into $4,400 possible.

But if you have read our blog, your know we are extremely bullish on LinkedIn(LNKD). Todays action maybe a prelude to the stock trading firmly above $120, which would result in those calls being up substantially more. Time will tell.

 

Where is the market headed tomorrow? We have used the VIX the last few months as a forward looking indicator, along with some other signals.  The VIX pushed through the upper bollie, only to fall back through it. We think this is a key reversal signal. Take a look at the chart below:

 

The great thing about options is, you only need to be right a few times out of 10 to make some serious cash. Check back after tomorrow and let us know how we did.

LinkedIn (LNKD) The Growth Story Continues

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I think people underestimate the true potential of a growth stock. The endless possibilities and limitless valuations. Growth stocks are an exception to normal market standards. Unfazed by macro economic conditions and gyrations, growth stocks continue to power to new highs. Like I said in previous posts, its only when everyone is on the Bull Bandwagon, that the stock pulls back.

Today's earnings from LinkedIN (LNKD) shows the stock is far from any sort of pullback and is still in the midst of a tremendous growth cycle. It also looks like shorts are starting to realize this, reducing  their short postions from 7 million shares in January to 4.3 million in April.

Traders will continue to cite chinks in the armor to induce a sell off and rationalize their losing trade. Maybe its the insiders selling shares? Maybe the 850 PE ratio? Competition? 

Of course these are all valid arguments, but not when a company is growing revenues over 100% YOY. LinkedIn (LNKD) earnings today reinforced our belief that the shares are headed to $150+ before summers end.

You heard it here first when the stock was trading at $100, and now you will hear it gain when the stock is at $120.

As for you LinkedIN(LNKD) bears, please let us know when you go long....

 

Thanks!

 


Shutterfly, Inc (NASDAQ:SFLY)

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At Option Millionaires, we are all about growth stocks. Being ahead of the market on these stocks can be VERY rewarding. We brought you LinkedIn (LNKD) at $80 which moved 35% over the past few months. We now bring you Shutterfly, Inc (NASDAQ:SFLY).

Just like LinkedIn (LNKD), it took an earnings report to show it's ready to take the market by storm. Shutterfly, Inc (NASDAQ:SFLY) was a once high flying stock in 2011, hitting a high of $66.70 in April 2011. It fell all the way to $21.34 on growth concerns. It's recent acquisition of Kodaks online photo service, was another step in the right direction. A step that came at the expense of short term profits, but sets the stage for long term growth.

Shutterfly, Inc (NASDAQ:SFLY) earnings report after the bell showed a 72% YoY growth of personalized products (Photo Books and cards), which accounts for 77% of the companies revenue. They also grew their customer base by 16% to 1.6 million. Obviously the Kodak acquisition will help with that number.

We really like this company for the near term, and think the stock will head toward $45.

We alerted the $40 calls in our chatroom this afternoon. Stay tuned for more about Shutterfly, Inc (NASDAQ:SFLY) in the coming days.