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Posts tagged ‘Timothy Bolger’

OptionsHoney on Fire!! Call Options on Visa and KKR Financial Holdings Ahead Of Earnings?! By: Tim Bolger

It has been an amazing few weeks for everyone reading Optionshoney.com and jumping in on some of my Options plays!!  I hope everyone is both enjoying my posts and making lots of honey ( i mean money) on my investment research and Options plays.  GNW, GS,  AAWW, POT, DANG, AVL, HL, etc have all been huge winners in 2012 and I have never been more focused in my entire life on hitting home runs…  My 4-5 years of following a majority of the stocks that I am designing Options trades on is starting to pay off tenfold.  I conduct rigorous fundamental research analysis on all of these companies that I post on and I follow the technicals closely as well… GNW and GS being the biggest returns thus far in 2012…

What is my Options play now?! I love Visa and KKR Financial Holdings ahead of earnings.  Both companies are headquartered in the San Francisco Bay Area and that is a place I call home…After Mastercard smashed earnings estimates this past week, I am long the $110 and $115 strike Feb Call Options on Visa(V). Attached is the Feb 17, 2012 Options Chain on V Call/Put Options courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=V+Options.  If V blows past estimates on Feb 8, 2012 and investors pile into shares, this could be a massive Options trade!!! More positive V news at: Visa Tops One M Chip Cards In The U.S.
DJ Realtime News – 8:00 AM ET 02/06/2012.

I am also long KKR Financial(KFN)  into earnings after the bell today. Check out the company at:   http://www.kkrfinancial.com. I own the April 2012 KFN $10 strike Call Options for a nickel and the April 2012 KFN $9 strike Call Options for .25 cents.  Here is the Options Chain for the April 2012 Call/Put Options on KFN courtesy of Yahoo Finance: http://finance.yahoo.com/q/op?s=KFN&m=2012-04. KFN is rallying a few percent today ahead of earnings and I am looking for this stock to break out to the upside on a good earnings report after the bell today.  KFN is trading at $9.22 right now and is up 21 cents on a negative day across all the major U.S. stock indexes. KFN is headquartered in lovely San Francisco and is poised to pop.  KFN has a trailing P/E of 5.1 and pays an 8% dividend.  Yes, this is a great value stock and pays an awesome dividend. I think this stock could easily trade to $17-20 dollars in a couple of years.  Go KFN Bulls…and who doesn’t love getting paid an 8% return on your money, while you wait for appreciation in this stock?!!

A profile on KFN courtesy of Yahoo finance:  KKR Financial Holdings LLC, together with its subsidiaries, operates as a specialty finance company with expertise in a range of asset classes. It primarily invests in financial assets, such as below investment grade corporate debt, including senior secured and unsecured loans, mezzanine loans, high yield corporate bonds, and distressed and stressed debt securities; marketable equity securities; and private equity. The company also invests in other asset classes, including natural resources and real estate. Its corporate debt investments are held in collateralized loan obligation (CLO) transactions that the company uses as long term financing for these investments. The senior secured notes issued by the CLO transactions are owned by unaffiliated third party investors and the company owns the majority of the mezzanine and subordinated notes in the CLO transactions. KKR Financial Advisors LLC serves as the manager of the company. KKR Financial Holdings LLC was founded in 2004 and is based in San Francisco, California.   Check out the ten day technical chart courtesy of Fidelity Investments on V and KFN below:

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Awesome Economic Data!! AAWW Moving Higher!!! Call Options?!! By: Tim Bolger

Keep an eye on ATSG and AAWW!! AAWW breaks above the $50 technical that I have been patiently awaiting…A better global economy is great news for both of these air cargo stocks. Go Bulls!!! Show me the Honey baby!!  I posted the other day on Options Honey suggesting that traders consider buying the AAWW Call Options ahead of the company’s upcoming Feb earnings report. Yesterday’s Options post on Optionshoney.com:  http://optionshoney.com/2012/02/02/atlas-air-worldwide-holdings-jumping-higher-trade-call-options-into-feb-13-2012-earnings/. The AAWW 52.50 strike Mar 2012 Call Options are up over 35% from yesterday’s close as AAWW surges over 4% today. ATSG is up over 5% today as well. Check out the 2 day chart below on AAWW, ATSG, and the S & P 500 courtesy of Fidelity Investments.  ATSG and AAWW are clearly outperforming the S & P 500 today and are ready to break out to the upside…Stay tuned for more exciting Options plays on Optionshoney.com…

 

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Atlas Air WorldWide Holdings Jumping Higher!! Trade Call Options into Feb 13, 2012 Earnings?!!! By: Tim Bolger

Atlas Air Worldwide Holdings(AAWW) has rallied over 25% in the past month and I think it continues to move much higher.  AAWW is a global provider of outsourced aircraft and aviation operating services. Read more on AAWW’s profile: http://finance.yahoo.com/q/pr?s=AAWW+Profile.  AAWW secured financing yesterday for the remaining delivery of six Boeing 747-8 Freighter Deliveries . That is spectacular news for investors!! Read more at Atlas Air Worldwide Completes Financing Arrangements for Remaining Six Boeing 747-8 Freighter DeliveriesBusiness Wire(Wed, Feb 1) If this stock breaks out above 50 shortly, I think it trades to the mid 60s in the next few months. Another major catalyst that might propel these shares much higher is AAWW’s earnings release on Feb 13, 2012.  A blow out quarter for AAWW and any positive 2012 guidance by securing the financing on the remaining delivery of 6 Boeing Freighter’s will be great for both shareholders of the stock and investors long Call Stock Options. AAWW  http://www.atlasair.com and it’s subsidiaries below:

What is the Options Trade on Atlas Air Worldwide Holdings(AAWW)?

Options Trade#1: For the short term trade into earnings of AAWW, I would think about purchasing the AAWW March 16, 2012 50.0 and 52.50 Strike Call Options. Attached is the March 16, 2012 expiration Put/ Call Options Chain courtesy of Yahoo Financehttp://finance.yahoo.com/q/op?s=AAWW&m=2012-03.  I would be a buyer of the $50 strike Call Options at $2.10 and the $52.50 strike Call Options at $1.25.  For $2,000, I can purchase 16 Call Option contracts on AAWW March 16,2012 $52.50 strike Call Options plus trading fees. That will give me the option to buy 1,600 AAWW shares at $52.50 a share.  If AAWW, blows out earnings this month and the stock trades to 60+ a share, this will be a very lucrative Options trade. Our $2,000 of capital invested on this Options play will be worth over $12,000 if the stock trades to $60 before expiration of the contracts. That would be awesome!! Keep in mind that if the stock closes below $52.50 at March expiration and AAWW has a bad quarterly earnings report on Feb 13, 2012, the Call Options may expire worthless. That is the high risk of Options…Hopefully, that will not be the case, but you know that you are risking the entire $2,000 plus trading fees on this Options trade.  For the more conservative longer term investor, owning the shares of AAWW stock may be a great alternative to buying the higher risk Call Options.  The growth story of AAWW’s revenue and earnings will be great over the next several years.  Good luck AAWW Bulls!! This could be a Big Money Options trade for all of you Optionshoney lovers!!

Check out the 60 day technical chart on AAWW below courtesy of Fidelity Investments:

Chart

Rare Earth Miners Up Big in Late Trade!! Options Active on Molycorp and Avalon Rare Metals!! By: Tim Bolger

After a pullback the last few days, Rare earth miners are staging a late day rally.  Why is this happening? Several possibilities, including big Tech earnings by Apple. These rare earth minerals are vital for building technology products like the ipod, disk drives, Mp3 players etc.  Another very likely reason for the spike in shares is the Fed pledging this afternoon to keep interest rates at historic lows through late 2014…that is a formula that spells a weak U.S. dollar and rising metals prices to me…that all equals rapid inflation to me…Keep an eye on a few of my favorite stocks in the rare earth space, which include: Molycorp, Avalon Rare Metals, and Lynas Corp. Tickers MCP, AVL, and LYSDY.pk.  All of these stocks are up over 5.5% on big volume today. MCP is up over 7% and Lysdy.pk is spiking 10%…Show me the money honey!!!

 

Remember my previous post on buying the Call Options on AVL…that trade is still in full effect and I like the Call Options on Molycorp(MCP) as well. I would think about buying the MCP Mar 17, 2012 30 strike Call Options for 2.35 a contract, with a slight pullback in the shares of Molycorp.  I am also still a big fan of the AVL Mar 17, 2012 3 strike Call Options for .25 cents.  Rare Earth Miners have room to run much higher in my opinion. So, Stay tuned to Optionshoney.com for more news on the Rare earth miners and options plays!!

 

Chart Courtesy of Fidelity Investments:

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Technology Giant “Apple” Spikes Higher on Blow-Out Earnings Report!! What are my Options Honey?? By: Tim Bolger

Apple Inc.(AAPL) blew out Wall St. Analyst expectations with its quarterly earnings report released last night. Steve Jobs thank you…you were a legendary business player and the most innovative technology pioneer that ever walked the planet. And now thanks to all of your hard work Mr. Jobs, Apple has just surpassed Exxon Mobil as the largest and most valuable company on planet earth by market capitalization. WOW!!!! [$$] Apple Again Becomes Most Valuable Company, So What’s Next?at The Wall Street Journal(Wed 10:06AM EST)

Who bought shares of AAPL in 2000? Well if you invested just $10,000 on the stock back then, you would be a multi-millionaire today.  The ipod, iphone, mac-books, ipad, etc have been one blockbuster innovative technology product after the next…Consumers around the globe have been buying all of these AAPL products like hot cakes and just can’t get enough of them. The halo effect has helped AAPL continue to dominate and sky rocket higher!! Everyone that I know with an iphone absolutely loves it…Sorry Blackberry and RIMM…Hello iphone and Android…And now there are over 500,000 mobile apps for that sleek, trendy mobile phone.

Let’s take a closer look at a few amazing financial statistics on Apple.  It is currently sitting on over $97 billion in cash and securities!!! What should Apple do with all that cash??  Well, I would argue they should have bought back millions of shares(treasury stock) the last few years and that would have been the best return on their capital for shareholders as AAPL shares continue to sky rocket higher!!  Well, they missed that boat and now is time for the company to consider paying out a special dividend to shareholders and consider acquiring smaller technology companies that they see fit to add more value to shareholders.  Apple is sitting on $103 in cash per share.  AAPL now has  a market capitalization of over $418 billion and hit an all time record intraday high of $454.45 a share today. Will AAPL hit a $1 trillion market cap in the next decade? Maybe the next 5 years?? It is starting to feel very realistic and only time will tell the rest of this amazing Tech story…

What is the Options play? Well, clearly buying the Call Options now are very expensive and that should have been done prior to this blow out quarterly report by AAPL and big spike in the shares…I would wait for a big pull back in the shares before buying any out of the money calls on AAPL.  I do feel that the longer term trend in AAPL shares is still much higher and think the stock could hit $525 in 2012.   The law of large numbers tells me that the stock may pull back to around $415, before surging to $500+ though and would wait for a pull back in the stock to buy Call Options or shares of the stock.

However, for the short term trade, I would consider selling the $440 Feb 17, 2012 AAPL Put Option for $12.70.  Yahoo Finance Options Chain: http://finance.yahoo.com/q/op?s=AAPL&m=2012-02. Keep in mind that in order to sell 1 Put Option contract on AAPL at a $440 strike, I will need $44,000 in cash in my brokerage account in case I get exercised on the AAPL shares. By selling this Put Option, I will receive $1,270 and I am comfortable with the worst case scenario of being exercised on the shares at $440. Best case scenario, the shares remain above $440 through the Feb expiration date and I pocket $1,270 without having to buy the shares as well. For longer term AAPL investors, I would wait for the shares to pull back to the $400-415 range before loading up on the shares or adding to already existing core positions in the stock.

Stay tuned to Optionshoney.com for the next big opportunity to buy some Call Options on AAPL, if the stock pulls back 10-12% from its current stock price level of around $447. I will be waiting patiently on the side line for an opportunity to buy these Call Options if AAPl stock pulls back to around $415.  If it continues to go straight up, I may have missed the boat on this trade and will just have to watch it keep flying higher.

Buying Call options after a big spike in a company’s shares is always a high risk trade and not one that I want to put my money on very often. Patience and timing are both very instrumental in making money and winning Options trades.

Chart Courtesy of Fidelity Investments:

Chart

E-Commerce China DangDang Inc(Dang) Soaring in January! Call Options Active! By: Tim Bolger

Chinese E-commerce company DangDang Inc(Dang) has been soaring in the past month and is up big this week on heavy volume. Dang profile: http://finance.yahoo.com/q/pr?s=DANG+Profile. The shares may continue to see huge upside over the long run and is a high growth/high beta stock.  It was recently announced that famous institutional money manager Tiger Global Management has increased there holding in Dang and is the largest institutional shareholder of the company. Clearly, they are betting on the long term growth of Dang as well and have an extremely successful track record of making money in the global equity markets.  Check out this recent article by Seeking AlphaDangdang: Like Rolling Back Time To Buy Amazon At $6at Seeking Alpha(Tue, Jan 17).                                                        

So what is the Options play on Dang??

Options Trade#1:  I like selling the Dang Feb 17, 2012 7 strike Put Options for .65 cents a contract. If I sell 10 contracts I will collect a premium of $650 minus trading fees. If the stock closes above $7 at expiration, I will make $650 minus fees. Worst case scenario, I get exercised on the shares and I am comfortable being long the stock at $7 a share.  By selling the puts it will help finance the potential purchase of 1000 shares of Dang at $7.  Ten contracts x 100 shares per contract=1000 shares. To put on this trade, I will need $7,000 in collateral in my brokerage account in case I get exercised on the shares of stock. Here is the yahoofinance options chain http://finance.yahoo.com/q/op?s=DANG&m=2012-02.

Options Trade#2: For the big Dang bulls, I would think about buying the Dang Jun 15 2012 8 and 9 Call Optionshttp://finance.yahoo.com/q/op?s=DANG&m=2012-06 I like the 8 strike Calls at .95 cents and the 9 strike Calls at .45 cents on a pullback in the stock to around 6.75.   I also like buying the 1o strike leap call options on Dang.  I would think about buying the Dang Jan 17, 2014 10 strike Call Options for around 1.90 a contract.  http://finance.yahoo.com/q/op?s=DANG&m=2014-01. If Dang stock trades back to over 30 in the next few years, these leap call options will be worth big money!!  Stay tuned for more action on optionshoney.com.

http://finance.yahoo.com/q/ta?s=DANG&t=6m&l=on&z=l&q=l&p=&a=&c=

Chart forE-Commerce China Dangdang Inc. (DANG)

Genworth Financial(GNW) Roaring Higher! Does Housing Bottom in 2012? By: Tim Bolger

Genworth Financial is a financial holding company, with its core business focused on selling insurance and additionally provides wealth management, investment, and financial solutions for individuals in the U.S. and around the World.  The three main facets of the business are: Retirement and Protection, International, and U.S. Mortgage Insurance.  See the full profile at http://finance.yahoo.com/q/pr?s=GNW+Profile.  The company has been very profitable historically, but the black swan events of the U.S. housing crisis and an unprecedented amount of defaults on mortgage loans that the company had insured led to alot of bleeding for GNW shareholders the last few years.  I have been following the stock for four years and I am beginning to see alot of value in the stock.  I believe that GNW will make it out of this housing mess alive and that it is well positioned to profit from a recovery in housing.  I strongly feel that long term investors buying more GNW shares on this temporary weakness in share price and peaking number of mortgage defaults will be rewarded in 2-3 years when the storm blows over.

GNW has been crushed over the past few years and has a high beta of 2.9 for all those momentum players out there.  I think that housing bottoms in the next 12-15 months and a significant decline in U.S. and European mortgage defaults would be great news for GNW investors.  Once the Mortgage insurance unit at GNW stabilizes and starts making money again, this will be the major catalyst and turning point for GNW stock to soar much higher.

From a deep value investor standpoint, currently GNW trades at $8.22 with a .24 Price to Book, .37 Price to Sales, and has a forward Dec 31, 2012 Price to Earnings of 6.5.  Those are extremely cheap stock valuation numbers that greatly support my thesis for buying GNW shares for the long term.  This stock could trade back to $24 a share and still be trading at only .75 book value. Wow!! Good luck to all of you Bulls…

GNW has rallied over 20% in the past 30 days.  I think the party for GNW shareholders has just begun.  Several financial stocks are rallying this week.  Check out my post yesterday on Goldman Sachs here https://optionshoney.wordpress.com/2012/01/18/goldman-sachsgs-call-options-active-on-q42011-earnings-beat-by-tim-bolger/ . Any traders that bought GS call options on my previous note made lots of money overnight as GS continues to rally higher today. Bank of America and several other financial stocks are up big again today as well.

GNW reports earnings on Feb 2, 2012.  Remember it is always a gamble to buy a stock before earnings releases, but I think GNW will beat Wall St. Analyst expectations and therefore, I want to own the stock and Call Options prior to the earnings release.  If they beat the street, the stock could sail 10% higher on positive news, especially on any positive report on a decline in mortgage defaults for their Mortgage Insurance business.  What is the Options Play on GNW?

Options Trade#1: If you are bullish on GNW going foward and would like to get long exposure to a continued rise in GNW shares, I  would think about buying the Mar 16, 2012 9 and 10 strike Call Options.  If GNW blows out earnings on Feb 2, 2012 these contracts will double or triple in value very quickly.  Remember that if GNW has a poor earnings report, these contracts will likely lose 30 to 50% on a bad report.  Alot depends on the EPS for the quarter and any forward looking comments by management that the housing mess could be nearing an end and any improvements in there mortgage insurance business. Attached are the Options Chains for this hypothetical trade courtesy of YahooFinance.  http://finance.yahoo.com/q/op?s=GNW&m=2012-03  I like the March 9 strike call options at a price of .30 cents and the March 10 strike call options for .09 cents.

Options Trade #2: For a more conservative and longer term trade, I also like buying the GNW Jan 18, 2013 7.50 Call Options for 1.90 a contract. Good luck to all and stay tuned for more news on GNW and the financials. Trading involves inherent risks and please consult your financial advisor before buying or selling any stocks/options. Optionshoney.com disclaimer.

http://finance.yahoo.com/q/ta?s=GNW+Basic+Tech.+Analysis&t=3m

Chart forGenworth Financial Inc. (GNW)

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