Tag Archives: soda

Folks have the story wrong on SodaStream (SODA)… or do they?

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This is not the first or second time we have written about SodaStream(SODA) at OptionMillionaires, and why should it be? Stocks like SodaStream(SODA) are an option traders wet dream with a history of violent swings. Any good trader knows history can tend to repeat itself, and we fully expect it to happen with SodaStream(SODA) over the next 2 weeks leading up to earnings on November 7th.  Two of the previous earnings reports were preceded with a nice move to the upside.  Leading up to August 8th earnings, SodaStream(SODA) moved up from $38.25 to $43.70 in 9 trading days, an 11.4% move. Leading up to the report in February the stock moved from 38.85 to $48.80 in 5 trading days, a 20.4% move.

This time around we are expecting a little more of a pop to $46 or so. Why? Well for one thing, the company continues to grow at an insane rate of 55%+ this year, has zero debt, and is cash flow positive.  With their product in more retailers in the US then ever this holiday season, they should see a huge bump in shipments leading up into the holidays. But if you know the SodaStream(SODA) story, this is nothing new to you. What would be new to you is a breakout from the current short induced choke hold the stock has been in for over a year. There are not many (if any) companies out there with the same financial performance of SodaStream(SODA) over the last 2 years, yet the stock price continues to move in the opposite direction of the companies performance.

My thesis is, folks have been shorting the stock since last summer, and continue to play a game of russian roulette. Not only are they short the stock, they are also  selling naked calls and puts to help finance the operation. Take a look at the option action on SodaStream(SODA) relative to the trading volume of the stock. Each month there are thousands of calls and puts expiring worthless which equals easy profits for those manipulating the stock to pin at max pain for call holders. With only 14 million shares in the float, SodaStream is an easy target for someone with deep pockets and a plan.

And it looks like that plan has been in action for sometime as there are now 8.2 million shares short as of September 28th. It would take over 17 days for the short holders to cover their position based on the average trading volume of the stock! That means 58.5% of the entire float is short. That count does not even include all the institutional investors and holders of the stock to include Cadian Capital Management, LLC, which added to it's position and now holds 2,047,625 shares ,which is over 10% of the outstanding shares.

All it would take for a colossal short squeeze, the type this market hasn't seen since volkswagon, is for someone else with bigger pockets to come in and buy into this undervalued stock. I would figure this is going to get more interest into earnings irregardless and currently hold the Nov $45 calls @ .40/.45. Please make sure you do your own due diligence and understand we are not registered investment advisors and are only voicing our opinion. We will have more on SodaStream(SODA) in the next few days.

 

 

10-16 Watchlist

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So far so good to start this week as the futures are solid green once again. Earnings season is starting to heat up as Goldman Sacks, Coca-Cola, and quite a few other stocks reported earnings this morning, with much more after the bell. Looks like Spain is going to work out a bailout finally. which bodes well for a risk-on environment, at least for the short term. Remember, I am playing for $SPY 150 in the short term, and use these dips to find beaten down stocks.

Going forward will post my possible entries below and then explain afterwards. Let me know if you like this better:

 

Stock Call/Put Strike Expiration Closing Price Entry Price
WYNN Call $125 Oct 0.15 0.15
FOSL Call $90 Oct 0.25 0.35
SODA Call $40 Oct 0.20 0.20
LNKD Call $120 Oct 0.10 0.10

 

I continue to like WYNN for a breakout, especially if we are over $116.88. We will not need earnings to go over $120. Grabbed the 120s @ .39/.51 yesterday and sent text alert on it. We should all bank some nice coin. I like LNKD for a bounce off it's recent sell-off. Key is it sold off for no reason which leads me to believe someone was unwinding some positions. I still love SODA here after the nice move yesterday, and I love FOSL after CITI upgrade this morning.

DPZ is another to watch today but may be hard to get any cheap calls, and upside over 40 maybe somewhat limited, but could see $41-43.

Stay tuned to chat for more trading ideas and lets have a great week!!

- Jimmybob

9-27 Watchlist

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With yesterdays holiday past us, today is poised to bring more volatility and volume. We have quite a bit of data and news coming out. The Jobs numbers and GDP numbers as well as durable goods orders giving mixed signals.  Jobless claims dropped to the lowest level in months while durable goods orders also dropped and GDP came in below ests. Futures were ramping overnight and this morning and faded a bit on the numbers, but have since moved back up higher.

We are awaiting a press conference on Spains plans at 9am eastern, which hopefully will calm any remaining fears. If things go as planned, the market should hold its gains and maybe rally today.. or at least thats what i think.

Some plays I am holding:

GOOG 770/775 calls | NFLX 57.50 calls  | BIDU $115 calls | AZO $400 calls | WYNN 120 calls also holding JBL FDS ISRG SODA and others in my other account.

Not sure if I will be adding any positions today but will be eyeing a few :

LNKD if it breaks 120 ill look again at some calls. Faded yesterday and never pulled the trigger

AAPL : Great video by UPB http://stocktwits.com/message/9706613 - wont play it but calls maybe in order

 

The best ones to play today will be the ones that were taken down the most in this 4 day pullback.

Stay tuned to chat for intra day plays. Will also be using the text service sometime today or tomorrow so be ready: https://www.optionmillionaires.com/sms-stock-option-alerts/

Remember playing a stock that is gapping reduces your odds of success. Sometimes better to sit on your hands then raise your risk.

Lets have a great trading day!

 

- Jimmy

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Another day, another 4 1/2 year high hit. Think this will be the story through september. Yesterday was a solid day with a last minute sell-off, which seems to be the action as of late. The Germany concerns about ratifying the ECB bond purchases became a non-issue and stocks are moving up this morning. I am probably going to be reducing positions heading into Thursday as I think the risk for a sell-off is very possible, although i think we ramp higher.. but you have to minimize risk!

AAPL releases details on it's new iphone and should provide the stock with some WILD swings. Will not be playing it at all as its anyones guess what happens there.

Plays im in or watching:

 

MAKO - Still like the $20 calls as i think the stock breaks the $18.50 resistance from yesterday and doesnt look back. I maybe wrong but we have 8 days till expiry. Risky play..

LNKD - thought it would need a day or two breather, but looks like it may get some legs on FB move. Will look for $120/$125 sept calls.. either this week or next

AIG - think the anchor holding the stock down is gone, and it will move to $35 or so. Already have the 33.50 and 34.50 calls. May add to the 34.50s if they are cheap.

SODA - have the 40/42.50/45 Sept calls. I still like her and with GMCR still brewing, should see continued upside.

 

Others I am in : PCLN 650 calls/ WYNN 110 calls / NFLX 62.50 calls / CMG $370 calls

 

Thats all for now! Lets have a great WEDNESDAY!!!!

 

- Jimmybob

9-11 Watchlist

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What a great start to the week with CMG continuation and SODA explosion. Lets hope the MOJO continues. As long as this market stays somewhat flat and melts higher these multi-day runners should continue. ONTO THE WATCHLIST:

SODA - like her for a multi-day breakout. With GMCR continuing to run expect some carry-over to SODA. Stock should be over $50 already IMHO so anything is possible. Grabbed 42.50/45 calls ontop of my 40.

MAKO - Think its the play of the day here im thinking. Joining the oversold bounce bandwagon. Figure she tests $20 today or tomorrow. $20 calls the play.

SLV/AGQ - will look to grab calls as the shake yesterday should be enough to break the next leg. AGQ 60 calls / SLV 34/35 calls

 

Others on watch: COH, TIF, PCLN, CMG, GMCR, LNKD

 

Short list today, want to keep focused on the few movers. Stay tuned to chat / twitter for alerts!

 

Lets have a great day!

 

- jimmybob