Credit Card Stocks on Fire in 2012!! Capitol One Financial(COF) Options?! By: Tim Bolger

Capitol One Financial (COF) stock has been on fire in 2012 and is one of my top stock picks in the credit card/financial services space for this year. Read more on the bio of COF courtesy of Yahoo Finance: Capital One Financial Corporation operates as the bank holding company for the Capital One Bank (USA), National Association (COBNA), and Capital One, National Association (CONA), which provide various financial products and services in the United States, the United Kingdom, and Canada. It offers consumer and small business credit card lending, national closed end installment lending, and the international credit card lending services. The company also provides various non-interest bearing and interest-bearing deposits, including demand deposits, money market deposits, negotiable order of withdrawal accounts, savings accounts, certificates of deposit, and other consumer time deposits. Its loan portfolio comprises credit card loans; consumer loans, such as auto, home, and retail banking loans; and commercial loans, including commercial and multifamily real estate, middle market, specialty lending, and small-ticket commercial real estate loans. In addition, the company provides mortgage banking, treasury management, and depository services. It primarily serves consumers, small businesses, and commercial clients through branches, the Internet, and other distribution channels. The company was founded in 1993 and is headquartered in McLean, Virginia.

Why do I love Capital One Financial (COF)?? This stock has been on a tear over the last couple of years and still looks very attractive from a fundamental valuation perspective. Currently, COF trades at $56.01(2;03p.m. EST), with a trailing Price to Earnings ratio of 8.23 and has a Price to Book value of .87. The book value of COF is $65.17 a share. In comparison to Visa (V), currently trading at $118.06 (2:04 p.m. EST), which has a trailing Price to Earnings ratio of 20.90 and has a Price to Book value of 2.94. The book value of V is $40.61 a share and is trading at a significant premium based on the Price to Book metric.  However, V is still an amazing growth story and it’s extremely important to note that V has zero exposure to losses from consumer defaults on credit card debt. This is in contrast to COF, which has great exposure to consumer defaults, because it lends alot of its own capital. Fortunately, for COF, consumer defaults have been declining as the global economy continues to improve and that has helped propel the stock even higher.

I love Visa (V) stock as well and would be a buyer of this stock under $110 per share. I believe V may run to $150 a share in 2012 and is truly another amazing success story in the San Francisco Bay Area. From a valuation perspective, I am a bigger proponent of owning shares of COF right now. COF could run to $80 in the next twelve months and next stop may be $100 per share…Legendary Hedge Fund Manager and Billonaire investor: John Paulson of Paulson & Company Inc., is one of the largest shareholders of COF, with his managed funds owning 9,420,000 shares of COF.

Capitol One Financial (COF) reports earnings on April 19, 2012. Analysts are anticipating a great quarterly report from COF. Will the company blow past Analyst earnings estimates?? And, what is the Options play on COF ahead of earnings? As you can see from the COF data below, courtesy of Yahoo Finance, COF has beat analyst expectations in three of their last four quarterly earnings reports. Clearly, the weakest financial report was their most recent one in December of 2011, in which they missed Analyst earnings expectations by 43.60%. Ouch! Yes, that was a terrible earnings miss, but I think this upcoming quarterly earnings report is going to be stellar and only time will tell the real story…Visa reported blow out numbers and I think COF earnings will thrill investors as well!!

Earnings History	Mar 11	Jun 11	Sep 11	Dec 11
EPS Est	1.55	1.71	1.68	1.56
EPS Actual	2.21	1.97	1.77	0.88
Difference	0.66	0.26	0.09	-0.68
Surprise %	42.60%	15.20%	5.40%	-43.60%

 

Trade#1: I would consider buying the Capitol One Financial(COF) $57.50 strike Call Options for $1.00 with an April 20, 2012 expiration. Attached are the COF Options chains with an April 20, 2012 expiration date courtesy of Yahoo Finance:http://finance.yahoo.com/q/op?s=COF+Options. If I buy 10 Call Option contracts, it will cost me $1,000 plus trading fees to get long exposure to 1,000 shares of COF at $57.50. I think that COF stock could trade to $65 per share if the company beats Analyst earnings expectations next month and gives an upbeat earnings guidance for the full year of 2012. Additionally, any positive comments by management on the conference call about a continued decline in consumer credit card defaults, would be another catalyst to propel COF stock much higher. If COF trades to $65 a share by the expiration of these Call Options, this trade will be worth at least $7,500 ($750 per contract x 10 contracts= $7,500 minus trading fees). Good luck COF bulls and remember that Options trading is very risky and to always consult your investment advisor before buying/selling any equity securities and/or Options contracts.

 

Trade#2: For the longer term bull in COF, I would consider buying the COF $57.50 strike Call Options for $3.50 per contract with a Sept 21, 2012 expiration date. Attached are the COF Options chains with a Sept 21, 2012 expiration date courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=COF&m=2012-09. I can buy 10 Call Option contracts for $3,500, in which I will be paying a premimum for more time value to allow COF shares to potentially climb much higher over the next several months. If the shares of COF trade to $70 a share over the next several months, this trade will be worth at least $12,500.  Good luck to all of the COF Bulls and stay tuned to http://www.Optionshoney.com for more monster Options trades!

Check out the Technical Chart on Capitol One Financial below (COF) courtesy of FinViz:

Juniper Networks (JNPR) Jumping Higher Today!! What are my Options Honey?! By: Tim Bolger

Juniper Networks (JNPR) is poised to sail higher in the coming months and Tech stocks continue momentum to the upside! Attached is a bio on Juniper courtesy of Yahoo Finance: Juniper Networks, Inc. designs, develops, and sells products and services that provide network infrastructure for networking requirements of service providers, enterprises, governments, and research and public sector organizations worldwide. The company operates in two segments, Infrastructure and SLT. The Infrastructure segment primarily provides scalable routing and switching products that are used to control and direct network traffic. Its products include Internet protocol routing and carrier Ethernet routing portfolio, and Ethernet switching portfolio comprising T series, M series, PTX series, E Series, MX series, and EX series, as well as QFabric and WLAN products. The SLT segment offers solutions that protect the users, applications, and data on the network itself to provide network services across a distributed infrastructure. This segment provides services gateways, integrated firewalls, and VPN solutions, which provide firewall/VPN performance and scalability and combines routing, switching, and security functionality; Junos Pulse mobile security suite and SA series SSL VPN appliances to provide secure access to corporate resources for remote and mobile users from any Web-enabled device; IDP series appliances that utilize intrusion detection methods to increase the detection rate of and prevent network attacks; and identity and policy control solutions to integrate subscriber privileges, application requirements, and business policies with the IP network infrastructure. The company sells its products and service through direct sales, as well as through distributors, value-added resellers, and original equipment manufacturer partners. Juniper Networks, Inc. was founded in 1996 and is headquartered in Sunnyvale, California.

I am long shares of JNPR and think there is big opportunity in the JNPR Options as well. So what is the Options play on JNPR??

Trade #1: I would consider buying the JNPR $23 strike Call Options with a July 20, 2012 for $1.35 a contract. Attached are the Options chains for Juniper with a July 20, 2012 expiration date courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=JNPR&m=2012-07.  I can buy 20 contracts for $2,700 plus trading fees and that will get me long exposure to 2,000 shares of Juniper at a $23 exercise price. If Juniper trades to 30 by this summer’s expiration date, these contracts will be worth $14,000 or more. Go Juniper Bulls and let’s make some honey…I mean money!!

Trade#2: I would consider selling the JNPR $23 strike Put Options with an April 20, 2012 expiration date for $1.40 a contract. Attached are the Options chains for Juniper with an April 20, 2012 expiration date courtesy of Yahoo Finance:http://finance.yahoo.com/q/op?s=JNPR&m=2012-04. I can sell 10 Put Option contracts and have $1,400 credited to my brokerage account. I think Juniper shares continue to move higher over the next several months and I believe the shares will trade higher than the $23 strike on the expiration date of these derivative contracts. However, I am comfortable with the worst case scenario of getting exercised on these shares at $23 each and going long a 1,000 shares of Juniper. Remember, this trade is not for beginners and I need to have $23,000 in cash in my brokerage account as collateral in case I get exercised on these shares. I will only get exercised on JNPR shares if the stock is trading below $23 per share on the April 20th, 2012 expiration date of these Put Options. Stay tuned for more action on Http://www/optionshoney.com.

Check out the Technical Chart below on Juniper Networks (JNPR) courtesy of Finviz.com:

Gotta Love the Fizzy Water and SodaStream (SODA)?! Options?? By: Tim Bolger

SodaStream International (SODA): the manufacturer, developer, and marketer of state of the art carbonated beverage making machines is taking the stage on Optionshoney.com. I have been doing rigorous fundamental research on this Israeli company and closely watching the stock trade for the past 3 months. I became very interested in this beverage company based on its unique technology and the fact that I had heard great product reviews from a few friends who owned this carbonated beverage making machine. Just a few days ago, I jumped on the SODA bandwagon and purchased my own SODA machine to carbonate water at the homestead. It’s so much fun and makes yummy bubbly carbonated water in just a few seconds.  It’s really awesome!! Then you just have to add your favorite syrup flavor and vodka if you so please and shizam you’ve got a killer cocktail or non-alcoholic beverage.  Will SodaStream be the next huge beverage machine growth story for investors, just like the Keurig and K-Cup were for Green Mountain Coffee Roasters (GMCR) Investors?!  I hope so and think it is very possible for this company to double or triple in market cap value and feel that this company is still in early global growth stages.

SodaStream is also super environmentally friendly and eliminates the need for recycling hundreds of millions of plastic soda water bottles every year…Now that rocks! The more people around the globe that fall in love with this beverage company’s cool products and fizz their own water at home, the cleaner this planet will be in the future. And, it truly makes yummy carbonated water in just a few seconds!! Sodawater and a squeezed lemon or orange is not only quick to make, but it’s super refreshing…

For all the SODA Bulls, let’s hope this stock is preparing to take off like a rocket ship. It has experienced some headwinds over the past few months and the stock has declined quite significantly. I think this is short term pullback in the stock and the longer term fundamentals remain intact for this beverage machine’s growth story…but only time will tell.  It  is heavily shorted and any good news could create a huge short covering and big pop in the stock!  I usually like to buy slightly beaten down stocks when they are presenting value opportunities and not trading at their 52 week highs. I’m ready to dive in to Sodastream options.

What is the Options play on SodaStream (SODA)?!

Trade#1: I am considering selling the SodaStream (SODA) $32.50 strike Put Options with an April 20, 2012 expiration for $1.75 a contract. Attached is the SODA April 20, 2012 expiration Options chains courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=SODA+Options. I need the stock to fall a few more percent, in order to sell these options for $1.75 a contract. If I sell 10 contracts for $175 a contract ($1.75 x 100 shares per contract=$175), I will credit $1,750 into my brokerage account minus trading fees. Remember, that by selling the Put Options, I am taking the risk of getting exercised on the shares at $32.50 per share, if the stock is trading below $32.50 on the expiration date of the derivative contracts. Therefore, to execute this trade, I will need $32,500 in cash in my brokerage account as collateral in case I get exercised and have to purchase 1,000 shares of the stock at $32.50 (10 contracts x 100 shares per contract=1,000 shares x $32.50 per share= $32,500 plus trading fees to buy the stock). I like this trade and am very comfortable in a worst case scenario of going long a 1,000 shares of the stock at $32.50. My 12 month price target on this stock is $60-70 per share. Selling the 10 Put Option contracts will finance $1,750 minus fees towards my potential purchase of the shares of stock at $32.50 as well and that is awesome.

Trade#2:  I would consider buying the SODA $32.50 strike Call Options with an October 19, 2012 expiration date for $4.25 a contract. Attached is the SODA Options chains with an October 19, 2012 expiration date courtesy of YahooFinance: http://finance.yahoo.com/q/op?s=SODA&m=2012-10. I need SODA shares to decline another 5-6% in order for me to buy these contracts for my desired price. Currently, the Ask (the price a seller is willing to sell the contracts for) is $6.60 a contract for these Call Options.  If I buy 10 contracts for $4.25, I will get long exposure to 1,000 shares of SODA at $32.50 per share. 10 Options contracts will cost me $4,250 plus trading fees. If shares of SODA trade to $50 before the October 2012 expiration date, these 10 contracts will be worth at least $17,500 and I will profit over $13,000 on the trade. Show me the Honey…I mean $$$. Let’s go SODA Bulls and remember Options trading is very risky. More conservative investors should avoid trading Options and just consider buying shares of SODA stock at $32 or less. Please remember to consult your investment advisor before buying and/or selling Equity Securities/Options. Stay tuned for more Options action at http://www.Optionshoney.com.

Check out the Technical chart on shares of SODA below courtesy of FinViz.com:

Tech Giant Oracle Has Big Quarterly Numbers and Stock Slides!! What are my Options?! By: Tim Bolger

German Sailing Grand Prix Kiel 2006. Team: BMW Oracle Racing. (Photo credit: Wikipedia)

Oracle Corporation (ORCL): the business software and hardware global giant is sliding over 2% to $29.48(3:19 PM EDT) after it beat the streets quarterly earnings expectations after the closing bell on March 20, 2012 (Q3 results ending Feb 29th).

In morning trade, Orcl stock popped to an intraday high of $31.15 a share and then reversed course to the downside breaking the important technical of $30 a share. Nearly 80,000,000 shares have traded hands on this tech giant before 3:26 PM EDT on a day of huge volume, in which investors/analysts have a mixed sentiment on the financial results of the company. Oracle beat analyst expectations by a slight percentage, coming in with $9.04 Billion in revenue for the quarter.  The street had Oracle coming in with an estimated $9.02 Billion, which is only a small beat and may partially explain why the shares are sliding after a quick knee jerk pop to the upside this morning.

On a more positive note, Oracle had a very impressive gross margin of 78.9% and an operating margin of 37.8%. Non-GAAP earnings beat the street by 6 cents, coming in at $0.62 cents a share and the street had predicted Oracle to come in at $0.56 cents a share. Check out the chart below courtesy of Capital IQ to take a closer look at the Non-GAAP earnings results in more detail:

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Despite the slide in Oracle shares today, I am still a raging bull when it comes to investing in this global technology giant. Larry Ellison is one of the smartest and richest Tech moguls on planet earth and I am very confident in the long term picture of continued profitability and share appreciation of this Bay Area Tech giant. I am maintaining my $37 price target for Orcl shares over the next 11 months and would be a buyer of the shares on this pullback.  I think this is short term storm for and pullback in Orcl shares and presents a great long term buying opportunity for new investors and those looking to accumulate more shares for their core positions. A great entry point in the stock will be at a share price of $27.50 or less. Now, what is the Option play?! I like the longer term Call options and selling the near term Put options on Oracle.

Trade#1: I would consider selling the Oracle(ORCL) $29 strike Put Option for $0.90 cents a contract with an April 20, 2012 expiration date. Attached is Oracle Options Chains with an April 20, 2012 expiration date courtesy of YahooFinance: http://finance.yahoo.com/q/op?s=ORCL&m=2012-04. If I sell 20 Orcl Put Options for $0.90 cents each, I will credit $1,800 into my brokerage account ($0.90 cents x 100 shares per contract=$90 and $90 x 20 contracts =$1,800).

Remember, by selling the Put options, we are taking the big risk of potentially being exercised on the shares of Oracle at $29, if shares of Orcl stock are trading below $29 on the expiration date of these contracts.  Therefore, we need to have $58,000 in cash in our brokerage account as cash collateral in the event that we get exercised on the 20 Put option contracts that we are considering selling. 20 contractsx$2,900($29 x 100 shares per contract)=$58,000. This is definitely not a trade for beginners, especially if you do not have the cash reserves to initiate the trade. However, I am a fan of this trade and a big long term bull on Oracle. In a worst case scenario, I am comfortable going long 2,000 shares of Oracle at $29 a share if I get exercised. By selling the Put options, I am in a sense financing $1,800 towards the potential eventual purchase of 2,000 shares of Oracle at $29 per share. By selling the Put Options, I am actually getting long the stock at $28.10 (net cost of $58,000-$1,800 credit=$56,200)because of the $1,800 that was initially credited to my brokerage account at the opening of this derivatives transaction.

Trade #2: I would consider buying the Oracle(Orcl) $29 strike Call Options with a Sept 21, 2012 expiration date for $1.25 a contract. Attached is the Orcl Options Chains with a Sept 21, 2012 expiration date courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=ORCL&m=2012-09. I can buy 20 contracts for $2,500($125 per contract of 100 shares x20 contracts= $2,500 to open this trade) and that will give me long exposure on 2,000 shares of Orcl stock at $29 a share for the next several months. If the stock trades to $35 by the September expiration date, my initial $2,500 investment will be worth over $12,000. That would be beautiful return on our capital and I think that Tech stocks continue to lead this market rally higher in 2012!!! Lets go Orcl Bulls!! Remember, we need Orcl stock to decline another  5 or 6% in order for us to get an opportunity to buy these September 2012 Call Options for $1.25 a contract. Options take alot of patience and discipline to be successful in making money. Please remember to consult your investment advisor before buying or selling any equity securities/stock options. Good luck and stay tuned for more big action at http://www.Optionshoney.com.

Coal Stocks Continue Free Fall!! Alpha Natural Resources(ANR) Options Honey?!! By: Tim Bolger

Alpha Natural Resources (ANR) acquired Massey Energy a few years back and has continued to slide alongside the entire Coal sector over the past 12 months. The stock is down over 70% in the past 12 months and is lighting up on my radar as a potential big long term investment opportunity. It has been a very warm winter in the NorthEast and that is not a good environment for Coal stocks…But, are coal stocks hitting a near term bottom?! Legendary Omaha, Nebraska Investor Warren Buffett has made many of his best investments when a sector is out of favor and trading at cheap valuations, but have great long term fundamentals.  Presently, I am seeing lots of value in Coal stocks and think the big slide over the past 12 months may be nearing an end.

Attached is a profile on Alpha Natural Resources(ANR) courtesy of Yahoo Finance: Alpha Natural Resources, Inc., together with its subsidiaries, engages in producing, processing, and selling steam and metallurgical coal in the United States. The company has mining operations in Virginia, West Virginia, Pennsylvania, Kentucky, and Wyoming. As of December 31, 2011, it owned or leased approximately 4.7 billion tons of proven and probable coal reserves; and operated 145 mines in northern and central Appalachia and the Powder River basin. The company is also involved in repairing and reselling equipment and parts used in surface mining; manufacturing particulate scrubbers and filters for underground diesel engine applications; rebuilding underground mining equipment; and providing coal and environmental analysis, and degassing services. In addition, it engages in the sale of non-strategic assets, such as timber, gas, and oil rights, as well as the lease and sale of non-strategic surface properties and reserves; coal brokerage; and road construction business. The company serves electric utilities, steel and coke producers, industrial customers, and energy traders and brokers. Alpha Natural Resources, Inc. was founded in 2002 and is based in Abingdon, Virginia.

What is the Options play on Alpha Natural Resources(ANR)?! ANR stock is trading at $16.64(10:29 Est Standard Time) and is down close to 70% in the last 12 months. Is now the perfect time to load up on the stock and options??

Trade#1: I would consider buying the ANR September 21, 2012 $19 strike Call Options for $1.60 a contract. Attached are the Sept. 21, 2012 Options Chains courtesy of Yahoo Finance:http://finance.yahoo.com/q/op?s=ANR&m=2012-09.  I can buy 10 contracts for $1,600 plus trading fees. That will get me long exposure to 1,000 shares of ANR at a strike price of $19. If Coal stocks recover over the next 6 1/2 months, ANR may be poised to lead this sector higher and outperform a majority of coal stocks. I am looking for ANR to trade $28 or higher by the September 21, 2012 Options expiration date. Hopefully, it will be a hot summer and that will be good for coal stocks, if Air conditioning use sky rockets. At $28 a share, my contracts will be worth $9.00($9.00x 100 shares per contract=$900 each) or greater. $900 x10 contacts=$9,000. Let’s hope this Coal slide comes to an end shortly and reverses course. Good luck to all the Coal and ANR Bulls!!! For more conservative longer term investors, I like buying shares of ANR stock at $15.00 or less.

Trade#2: I am an ANR Bull and would consider selling the ANR April 20, 2012 $15 strike Put Options for .90 cents a contract. Attached is the April 20, 2012 Options Chains on ANR courtesy of Yahoo Finance:http://finance.yahoo.com/q/op?s=ANR&m=2012-04. If I Sell 10 Put Option contracts, I will credit $900 to my brokerage account. 10 contracts x $90 per contract=$900. Remember, that we need $15,000 in cash reserves in our brokerage account in order to place this trade. The $15,000 is for the worst case scenario in which we get exercised on the 10 Put Option Contracts we sold (10 contracts x 100 shares=1,000 shares) of ANR at the $15 strike price at expiration. We will only get exercised on the shares of ANR if the stock trades below $15 on the expiration date. Either way, I am comfortable getting long shares of ANR stock at $15 and selling the Put Option contracts will help finance $900 towards my potential purchase of the $15,000 in stock. Go ANR Bulls and remember that Options are risky financial instruments. Please consult your investment advisor before buying or selling any Options/Equity Securities.

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See Below a 1 year chart on Alpha Natural Resources(ANR) courtesy of BigCharts.com:

Honey?! Lock in Some Profits on Oracle Call Options?! By: Tim Bolger

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I have been a long term bull on the Oracle Corporation(ORCL) and love this company… Earlier this week , I recommended that Options honey readers consider buying the Mar 16, 2012 expiration $30 strike Call Options on Oracle (ORCL) for .20 cents(.20 x 100 shares per contract=$20 a contract plus trading fees). Oracle is trading up 1.23% at 29.61(11:21 AM EST) and the March 16, 2012 $30 strike Call Option contracts have gained almost 100% in value. Attached is the March 16, 2012 expiration $30 strike ORCL Call Option courtesy of Yahoo Finance: http://finance.yahoo.com/q?s=ORCL120317C00030000. 

 

You might want to consider selling 40% of your position to lock in a big gain at .40 cents a contract(.40 x 100 shares per contract=$40). That would be a quick gain of $800 minus trading fees. That’s nice!! Lovin’ that Honey…I mean Money!! If you bought 100 contracts, you will still have 60 contracts remaining in order to profit huge from the potential move in the stock above $30 in the next few trading days. I reiterate my $37 2012 price target on Oracle shares and strongly believe that if the stock breaks 30, it will run into the low 30s very quickly.

Good luck Oracle Bulls & Stay Tuned to http://www.Optionshoney.com!!

Bernanke Speaks on Capitol Hill and Precious Metals Plummet!! Gold Tanking…Options?! By: Tim Bolger

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Federal Reserve Chairman Ben Bernanke is speaking on Capitol Hill at the moment…During his speech the markets have all turned into the red and Gold is plummeting over $65 an ounce(11:50 am Eastern standard time)…Wow!! It is amazing how the Fed chief can move markets and metals prices in just a few seconds while addressing Congressional leaders and the American people.  I’m a long term bull on Silver and very bullish on Goldilox…Gold was trading down as much as $80 an ounce intraday.

So what is the options play on Gold tanking today?!

Trade#1: I would consider selling the $165 April 20, 2012 Put Options on the GLD for $4.25 a contract. Remember that in order to sell these 3 contracts, we need to have $49,500 in cash reserves in our brokerage account in case we get exercised on the GLD shares at $165 a share.  I am comfortable going long the GLD at $165 and therefore I like this trade alot…By selling 3 Put Option contracts, I will collect a premium of $1,275 minus trading fees. If the GLD bounces after this major sell off today and moves higher I will not get exercised on these shares at expiration. Either way, I like this trade and selling the Put Options will help finance the worst case scenario, in which I get exercised on 3 Put Option contracts (3 x 100= 300 Gld shares at $165 a share). Attached is the April 20, 2012 Options Chains on GLD courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=GLD&m=2012-04.

Trade#2: I would consider taking advantage of this huge sell off in Gold today and think about buying the $165 June 15, 2012 expiration GLD Call Options for $4.80 a contract. I can buy 10 Call Option contracts for $4,800 plus trading fees and that will give me long exposure to 1,000 shares of GLD at $165 a share. My $4,800 investment will be worth over $10,000 if GLD trades to $175 by the June 15, 2012 expiration.  Attached is the June 15, 2012 Options Chains on GLD courtesy of Yahoo Finance:  http://finance.yahoo.com/q/op?s=GLD&m=2012-06. Good luck to all of the Goldilox bulls and stay tuned to Optionshoney.com for more Options action!! Show me the honey!!

For more conservative investors, I would stay away from the Options on GLD and just buy the GLD at $165 or less. The GLD is a great hedge on higher inflation and a weak U.S. Dollar…The other way to get Gold exposure is by purchasing 10 ounce gold bars or the beautiful 1 ounce Gold American Eagle coins. It is really nice to own the physical and fun to hold these shiny yellow bars/coins…and yes they are worth alot of money too!! I am also a big fan of owning shares of Canadian gold miner: Barrick Gold Corporation (ABX) at $45 or less a share.

Technology Stocks Move Higher!! Oracle Options Honey?!! By: Tim Bolger

Image via Wikipedia

Image via Wikipedia

I’ve been a long term bull on Oracle Corporation and believe that it is one of the best run companies on the planet…It has some of the highest gross margins and cutting edge software products on the planet as well…To put the icing on the cake, it is run by CEO and Co-founder Larry Ellison…Ellison dominates the Technology business software sector and almost everything he touches turns to Gold…Attached is my post on Oracle Corp earlier this year:

http://optionshoney.com/2012/01/16/ellison-and-oracle-dominate-the-globe-what-is-the-options-play-honey/.

After a huge run up in the Nasdaq, Oracle has lagged over the past 6 months and I believe that it is starting to get footing and will climb higher…I am a buyer of the stock under $29 a share and I have a $37 twelve month price target on this Tech stock…It is definitely a great stock to park alot of cash into, especially if the markets get very volatile again.  Any pull backs in the stock are excellent opportunities for long term investors to add to their core positions in Oracle shares.  I am watching the Call Options on Oracle very closely and have been monitoring the stock for several years…Remember, Options take patience/precision and are not suitable for all investors.  I often cost average my purchase of Options contracts, just like I would buying shares of a company. I rarely ever back up the truck all at once when buying Options contracts because I do not have a crystal ball that perfectly predicts short term bottoms in stocks and overall market indexes.  So what am I buying?! Options honey?!

Over the past few weeks, I have been diversifying my portfolio with Options contracts on several Technology companies including Juniper (JNPR) and Nuance Communications (NUAN) to name a few…

Oracle Options Honey?!

Trade#1:  I am looking at buying the Oracle (ORCL) March 16, 2012 $30 strike Call Options for .20 cents a contract. 100 shares per Options contract x .20 cents= $20 per contract plus trading fees. Attached is the Mar 16, 2012 expiration Options chains for Oracle Corporation courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=ORCL+Options. For $1,000 plus trading fees, I can purchase 50 contracts on ORCL with a $30 strike price. If the stock trades to $31 in the next 3 weeks, my 1k will be worth over $5k. My goal is for the stock to trade to $32, and 1k will be worth 10k for example…I believe ORCL is in an uptrend and if it breaks $30, the stock will run quickly into the low 30s. Good luck to all of the Oracle Bulls!! Remember that options are high risk financial instruments and are not well suited for all traders or conservative investors. Please see the optionshoney.com disclosure and please consult your investment advisor before buying or selling any options/equity securities.

Trade#2: For the longer term bull on Oracle(ORCL), I would think about buying the ORCL Sept 21, 2012 expiration $31 strike Call Options for $1.35 a contract. Attached is the Sept 21, 2012 expiration Options chains courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=ORCL&m=2012-09. If the stock trades to $35 by the September expiration, you will almost triple your money…Stay tuned for more options action at Optionshoney.com.

Technology Stocks in the Spotlight!! Call Options?! Juniper Networks… By: Tim Bolger

Technology Stocks have been on a tear in early 2012 and have had a great run over the past few years…I am following a number of Tech stocks and several of these will be in focus over the next few months on Optionshoney.com. Dell is sinking over 6% today after an unfavorable quarterly earnings report and alot of selling among investors today. Apple hit an all time high of $526 a share last week and has been an absolutely amazing stock to own over the past several years.

What stock is going to pop next?! Well, I have several on the radar and reiterate how options trading takes alot of precise timing and patience before we make a trade.  Many stocks will pop, but our timing is key to benefit from big moves in a stock…

So what is the options play?!

I am a big fan of Sunnyvale, CA based Juniper Networks (JNPR) and think the stock could trade into the mid 30s in 2012. A quick bio on Juniper Networks (JNPR) courtesy of Yahoo Finance:  Juniper Networks, Inc. designs, develops, and sells products and services that provide network infrastructure to create environments for the deployment of services and applications over a single network. The company’s Infrastructure segment primarily provides scalable routing and switching products that control and direct network traffic. Its products include Internet protocol (IP) routing and carrier Ethernet routing portfolio, and Ethernet switching portfolio comprising T-series, E-series, MX-series, VXA Series, and EX-series, as well as JCS, TX, and TX plus products. The company’s SLT segment offers firewall virtual private network systems and appliances, SRX services gateways, secure socket layer virtual private network appliances, intrusion detection and prevention appliances, the J-series router product family, and wide area network optimization platforms. Its products protect the network and data on the network, enhances existing bandwidth, and accelerates applications. In addition, the company provides Junos platform comprising the Junos Space network application platform and Junos Pulse integrated, multi-service network client, which enables its customers to expand network software into application space and deploy software clients to control delivery, as well as offers support, professional, and educational services. It sells its products and services through direct sales force, distributors, value-added resellers, and original equipment manufacturer partners to wireline, wireless, and cable operators; Internet content and application providers; businesses; federal, state, and local governments; and research and education institutions. Juniper Networks, Inc. was founded in 1996 and is headquartered in Sunnyvale, California.

Forbes is reporting today on Juniper’s acquisition of Mykonos Software: Juniper Buys Mykonos Software For $80 Million In Cashat Forbes(Wed 9:35AM EST)

Trade#1: I like the JNPR Mar 16, 2012 $24 strike Call Options for .95 cents a contract. I can purchase 10 contracts for $950 plus trading fees and that will get me long 1000 shares of JNPR at $24 per share. This trade is speculating on a 10% move to the upside in JNPR shares over the next 3 weeks. If shares trade $26, we will double our money at a minimum…Attached is the March 16, 2012 expiration Options Chains for JNPR courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=JNPR+Options.

Trade#2: I like buying some longer term Call Options on JNPR and would be a buyer of the JNPR July 20, 2012 $23 strike Call Options for $2.90 a contract. I can purchase 10 contracts for $2,900 plus trading fees as a means to get long 1000 shares of JNPR stock at a strike price of $23 per share. Attached is the JNPR July 20, 2012 Expiration Options Chains courtesy of Yahoo Finance:http://finance.yahoo.com/q/op?s=JNPR&m=2012-07. I am looking for JNPR shares to trade $30 or higher before the expiration of these contracts. If the stock trades over $30 per share in the next few months, my 10 contracts would be worth over $7,000. Good luck to all of JNPR Bulls!! I would also be a buyer of the stock at $24 or less per share.  I strongly believe that Juniper will be a great stock over the next couple of years and will significantly outperform the major market indexes.  Additionally, Juniper is a potential acquisition target for a much larger Technology company. I believe that a takeover of Juniper would be at a substantial premium to where the stock is trading at today. Currently, JNPR is trading at $24.19 and is up over 1.75% today (11:19 a.m. Eastern time)…

See below a 3 month technical chart on Juniper Networks(JNPR) courtesy of Fidelity:

S&P 500 DJIA NASDAQ Industry

Greece Inks a Huge 2nd Bailout!! Metals Jumping! Options honey?! By: Tim Bolger

Photo courtesy of: http://www.iho-ohi.org/index.php/category/greece/

Riots continue to escalate all over Athens throughout the long weekend and Greece inks a 2nd bailout deal with European finance officials to save the country from bankruptcy in the short term…such a beautiful country that has been crushed by sovereign debt issues and a very weak economy. The Dow Jones is flirting with 13000 and metals are jumping today on this breaking news on Greece…Gold is up over $26 an ounce today and I posted an article on Jan 17, 2012 about my long term bull case for Goldilox moving higher…here is my previous post on Gold: http://optionshoney.com/2012/01/17/can-you-say-goldilox-is-soaring-this-shiny-metal-is-hott-in-january-gold-options-honey/.  I suggested traders/investors think about buying the June 15, 2012 $165 strike Call Options on the GLD for $6.00 a contract. Those GLD Options contracts are spiking higher today and may still move much higher in the near term. The ishares Silver Trust(SLV) is trading 2% higher as well today.   I would recommend more conservative investors to buy shares of stock on the GLD and SLV for the long term…I like the GLD at $165 and the SLV at $29.

I am very positive on the miners going forward and I think there is still huge upside in that space…Many of the miners have underperformed the big rise in metals prices over the past few years and that is where I am seeing the most opportunity for investors seeking value plays.  I am increasing my position today on Hecla Mining (HL) by buying the Call Options and I would be a buyer of the Call options on General Molycorp(GMO) as well. Hecla Mining reported earnings today and the stock is soaring over 7 %…Business wire reports: Hecla Reports Record 2011 Revenue & Gross ProfitsBusiness Wire(Tue 8:00AM EST). Hecla Declares Silver-Linked Dividend and Adds New Minimum DividendBusiness Wire(Tue 8:15AM EST)

A quick profile bio on Hecla Mining courtesy of Yahoo Finance: Hecla Mining Company, together with its subsidiaries, engages in the discovery, acquisition, development, production, and marketing of silver, gold, lead, and zinc. The company produces lead, zinc, and bulk concentrates and sells them to custom smelters; and unrefined gold and silver bullion bars, which it sells to precious metals traders. It holds 100% interest in the Greens Creek operating unit located near Admiralty Island in Alaska; and 100% interest in the Lucky Friday operating unit located in Idaho. Hecla Mining Company founded in 1891 and is based in Coeur d’Alene, Idaho.

http://www.hecla-mining.com/exploration/ Chart below is on Hecla Mining Silver Growth:

What is the Options Play on Hecla Mining?!  

Hecla Mining(HL)  is jumping over 6.5% today and I would think about buying the March 16, 2012 $5 strike Call Options on HL for .45 cents a contract.  Attached is the March 16, 2012 Options Chains for HL courtesy of Yahoo Finance:  http://finance.yahoo.com/q/op?s=HL&m=2012-03.

I would also consider buying longer term options contracts on HL further out to give us a little more time for a continued rise in the shares of HL.  I like the HL June 15, 2012 $6 strike Call Options for .25-.30 cents a contract. Attached is the Options Chains on HL for June 15, 2012 expiration courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=HL&m=2012-06. Stay tuned for more big trades at http://www.Optionshoney.com!!

See below the 5 day technical chart on Hecla Mining (HL) courtesy of Fidelity Investments: