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DIS

0-Cost Options Strategy ahead of earningsSOUND BUT UNEXCITING FUNDAMENTALS Consensus is favorable on aggregate: Buy recommendation, +12.75% target upside. Numbers are compelling (5-yr rev growth +6.63% and ROE +20.35%) but growth has been slipping, esp. in TV. Valuation is un-demanding at a P/E of 17x (now less expensive than the market?) TECHNICALLY ON A DOWNTREND BUT COULD BE REBOUNDING DIS has been on a downtrend since the double-top of Aug/Nov 2015. The long-term (M chart) is still clearly negative. The medium-term (W) shows a series of negative cross-overs and a H&S formation. But lately the stock has been rebounding with the market and the short-term picture (D) is turning positive. A close above the 97.00 (MA200) would confirm the positive turnaround. A close below 90.00 would confirm the negative trend and potentially take us towards the H&S target of 84.00. EARNINGS AND GUIDANCE WILL BE A KEY CATALYST What could propel the stock higher are the earnings and guidance from DIS. STRATEGY: 0-COST EXPOSURE TO UPSIDE IN CASE OF BREAKOUT Buy Nov 18 2016 $98 call to play the breakout = $0.34/share Sell Nov 18 2016 $90 put to finance the synthetic long = $0.33/share Best-case scenario: Stock breaks out ==> Make $ on the call or convert Worst-case scenario: Stock tanks ==> Go long a quality long term holding close to the 52w low.
NYSE:DIS
by HAL9000
DIS EARNINGS PLAYSDIS announces earnings today after market hours, so look to put on any setup before New York close. Here are the two "classic" setups: Feb 19th 82.5/100 short strangle Probability of Profit %: 74% Max Profit: $127/contract Buying Power Effect: Undefined Feb 19 77.5/82.5/100/105 iron condor Probability of Profit %: 72% Max Profit: $86/contract Buying Power Effect: $414 Notes: You can naturally play with the width of the iron condor wings to increase/decrease buying power effect and/or max profit potential. As always, look to take the setup off at 50% max profit post-earnings or a side at or near max. In the event a side is tested, look to roll the tested side out for duration to a later expiry and then sell an oppositional side against the rolled side for a credit that exceeds the debit paid for any roll and look to exit the rolled out setup for scratch (total debits paid minus total credits paid = 0) and to redeploy your buying power elsewhere. They are, after all, meant to be quick and dirty plays ... .
NYSE:DIS
by NaughtyPines
THIS WEEK'S OPTIONS WORTHY EARNINGS PLAYS -- DIS, BIDU, TSLAUnfortunately, I was fiddling around so much with setups in index ETF's and GLD last week that I didn't get a chance to do a single earnings play ... But it's all good. Naturally, if volatility remains high in SPY, DIA, QQQ, and/or IWM, I'll continue to work those. However, while I'm waiting for some kind of bounce to occur to leg into the short call side of those on strength, maybe I'll be able to fit one of these plays in just to keep myself entertained. CVS -- announces on 2/9 (Tuesday) before market open. Implied volatility rank: 83/implied volatility 31. I'll have to look at that one closer to earnings. The implied vol number suggests that while volatility is temporarily high, it's just not one of those underlyings that are very volatile generally speaking. DIS -- announces on 2/9 (Tuesday) after market. Its implied volatility rank isn't quite where I'd like it (63; >70 is better), but you never know what'll happen going into the last couple of days here. BIDU -- announces "some time" on 2/10, which could be before/after market (you'd think they'd know at this point ... ). High implied volatility rank (83) plus high volatility (58) equals good premium. I would probably just look to put on a play on Tuesday if the premium looks attractive (it does right now; even for an iron condor setup). WYNN -- announces "some time" on 2/10. Rank: 95/implied 80. This little guy is not for the faint of heart. I've been in and out of WYNN several times this year as a non-earnings premium selling play and it whips all over the place, with a Daily 14-Period ATR of between 3 and 4 bucks ... . TSLA -- announces on 2/10 after market close. What's not to like about a TSLA play? Implied volatility rank is at 100 and the implied volatility is 82. Beaucoup premium ... . There are naturally a bunch of others announcing earnings, it's just that they're not necessarily good premium selling plays due to their implied volatility, so they'll probably just have to be played some other way ... .
NYSE:DIS
by NaughtyPines