12:25pm (EST)
We love earnings cycles and although we wish there was another stock besides Alcoa (AA, $9.14, up $0.04) that “officially” opens each quarter, it’s show time on Wall Street.
Earnings seasons are when stocks can make tremendous moves of 5%-10% or more based on what they say. Of course, each company will have different excuses for not meeting expectations and will blame Super Storm Sandy or the Fiscal Cliff, Debt Threat, the zombies and Obamacare as reasons on why they missed expectations.
The companies that beat the suit-and-ties forecasts have trimmed the fat, redesigned themselves, or have hot products and services that people want and are buying. The bar has already been lowered because of the aforementioned headwinds so we will be interested in what companies say about their full-year outlook rather than the quarter that just ended.
Alcoa is expected to post a profit of 6 cents a share on revenues of $5.6 billion. Shares hit a 52-week low of just under $8 back in October 2012 on its 3Q report. We have recommended the stock a few times over the past couple of years as successful covered call trades for our Weekly Wrap but we currently do not have a position in Alcoa.
The options are pricing a 5% move in the stock as the January 9 calls (AA130119C00009000, $0.30, flat) and the January 9 puts (AA130119P00009000, $0.20, flat) are going for 50 cents, together. With shares at $9, a 45-50 cent move is being priced in.
While we will be watching Double-A’s earnings, we were impressed with Monsanto’s (MON, $98.42, up $2.48) numbers as the stock pushes fresh 52-week highs. Shares look poised to crack triple-digits and have traded to $99.99 today.
We mentioned on our Watch List this morning Potash (POT, $41.79, up $0.11) could see a pop and shares have traded up to $42.08 today. We have 2 earnings trades in play so we will be passing on Alcoa which should match or beat Wall Street’s penciled-in numbers.
A good quarter by Alcoa could help the Dow on Wednesday and is struggling again today as the bears are trying to crack support that served as prior resistance. The good news, like yesterday, support is holding. (read more…)
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If you are not a subscriber but would like to read more please click here. We are one of the fastest growing stock options trading advisors on the internet and we had an incredible 2012. We offer 2-3 powerful call or put option trades each week (depending on market conditions) aimed at triple-digit returns for our Daily newsletter and our Weekly Wrap Covered Call Portfolio strides for double-digit returns on a monthly basis. Together, we were 159-70 (70% win rate) for both newsletters in 2012 with over 30-triple-digit winners. Our 5-year track record from 2008-2012 is now a staggering 621-273 that is also a 70% win rate. We doubt you will find a better options trading service.
This entry was posted
on Tuesday, January 8th, 2013 at 12:31 PM and is filed under Earnings, Market Analysis, Market Commentary, Option Trades, Strategies, Trade Update, Trading Tips.
You can follow any responses to this entry through the RSS 2.0 feed.
Both comments and pings are currently closed.
Alcoa (AA) on Deck/ New Option Trade!
12:25pm (EST)
We love earnings cycles and although we wish there was another stock besides Alcoa (AA, $9.14, up $0.04) that “officially” opens each quarter, it’s show time on Wall Street.
Earnings seasons are when stocks can make tremendous moves of 5%-10% or more based on what they say. Of course, each company will have different excuses for not meeting expectations and will blame Super Storm Sandy or the Fiscal Cliff, Debt Threat, the zombies and Obamacare as reasons on why they missed expectations.
The companies that beat the suit-and-ties forecasts have trimmed the fat, redesigned themselves, or have hot products and services that people want and are buying. The bar has already been lowered because of the aforementioned headwinds so we will be interested in what companies say about their full-year outlook rather than the quarter that just ended.
Alcoa is expected to post a profit of 6 cents a share on revenues of $5.6 billion. Shares hit a 52-week low of just under $8 back in October 2012 on its 3Q report. We have recommended the stock a few times over the past couple of years as successful covered call trades for our Weekly Wrap but we currently do not have a position in Alcoa.
The options are pricing a 5% move in the stock as the January 9 calls (AA130119C00009000, $0.30, flat) and the January 9 puts (AA130119P00009000, $0.20, flat) are going for 50 cents, together. With shares at $9, a 45-50 cent move is being priced in.
While we will be watching Double-A’s earnings, we were impressed with Monsanto’s (MON, $98.42, up $2.48) numbers as the stock pushes fresh 52-week highs. Shares look poised to crack triple-digits and have traded to $99.99 today.
We mentioned on our Watch List this morning Potash (POT, $41.79, up $0.11) could see a pop and shares have traded up to $42.08 today. We have 2 earnings trades in play so we will be passing on Alcoa which should match or beat Wall Street’s penciled-in numbers.
A good quarter by Alcoa could help the Dow on Wednesday and is struggling again today as the bears are trying to crack support that served as prior resistance. The good news, like yesterday, support is holding. (read more…)
****************************
If you are not a subscriber but would like to read more please click here. We are one of the fastest growing stock options trading advisors on the internet and we had an incredible 2012. We offer 2-3 powerful call or put option trades each week (depending on market conditions) aimed at triple-digit returns for our Daily newsletter and our Weekly Wrap Covered Call Portfolio strides for double-digit returns on a monthly basis. Together, we were 159-70 (70% win rate) for both newsletters in 2012 with over 30-triple-digit winners. Our 5-year track record from 2008-2012 is now a staggering 621-273 that is also a 70% win rate. We doubt you will find a better options trading service.
This entry was posted on Tuesday, January 8th, 2013 at 12:31 PM and is filed under Earnings, Market Analysis, Market Commentary, Option Trades, Strategies, Trade Update, Trading Tips. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.