Wednesday, October 31, 2007
Once again, far behind...
I don't think I'll ever be consistent with this blog, but since nobody reads it, I'll be fine. Today is actually the first busy day in some time.
SSYS: Stock mentioned a while back after a Barchart Downgrade. Reported so-so earnings today and just got killed. Too bad I had to wait until 11 (est) to buy as it has rallied since the open. Still, the stock looks good, and their forward guidence was fine. The details: Everything is growing nicely (even with the 'miss' this morning), revenue, income, and eps. Margins are stable, no debt, high short (probably some covering this morning), etc., etc. Bought 3.86280 shrs @ $25.888 (original alert for 26 although low of the day was ~21!). Would consider adding to position at $23 or so. By the way, no usable options for this stock).
LTM: Stock I did not post when it was downgraded (both by an analyst and by Barchart). Picked it out as a decent growth stock, growing rev., income, eps. MAJOR redflag is the debt, and debt to equity >1 (these guys need to make some cash and pay off the debt sooner than later...). Another stock with huge short. Bought 1.65975 shrs @ $60.25 (alert was $60.50). Will consider adding to the position at $57.60.
Did have an options play:
At time of downgrade (close): 55 May08 call for $11.90 (underlying price $62.56)
55 May08 call for $10.10 (underlying price $60.19)
Other option plays, based on downgrades 10/30/07:
FTI: 45 Apr08 call for $18.00 (underlying $60.10), alert for buy at $57.00
COL: 60 Apr08 call for $16.10 (underlying $73.86), alert for buy at $69.50
Wow, lots to look over and paper trade. Am concerned I am getting too mutual fund like with too many stocks, but if they all go up...
For now,
Masterjaz out
SSYS: Stock mentioned a while back after a Barchart Downgrade. Reported so-so earnings today and just got killed. Too bad I had to wait until 11 (est) to buy as it has rallied since the open. Still, the stock looks good, and their forward guidence was fine. The details: Everything is growing nicely (even with the 'miss' this morning), revenue, income, and eps. Margins are stable, no debt, high short (probably some covering this morning), etc., etc. Bought 3.86280 shrs @ $25.888 (original alert for 26 although low of the day was ~21!). Would consider adding to position at $23 or so. By the way, no usable options for this stock).
LTM: Stock I did not post when it was downgraded (both by an analyst and by Barchart). Picked it out as a decent growth stock, growing rev., income, eps. MAJOR redflag is the debt, and debt to equity >1 (these guys need to make some cash and pay off the debt sooner than later...). Another stock with huge short. Bought 1.65975 shrs @ $60.25 (alert was $60.50). Will consider adding to the position at $57.60.
Did have an options play:
At time of downgrade (close): 55 May08 call for $11.90 (underlying price $62.56)
55 May08 call for $10.10 (underlying price $60.19)
Other option plays, based on downgrades 10/30/07:
FTI: 45 Apr08 call for $18.00 (underlying $60.10), alert for buy at $57.00
COL: 60 Apr08 call for $16.10 (underlying $73.86), alert for buy at $69.50
Wow, lots to look over and paper trade. Am concerned I am getting too mutual fund like with too many stocks, but if they all go up...
For now,
Masterjaz out
Wednesday, October 24, 2007
BCR Buy...
Slightly unusual situation. I did mention the alert on BCR in a recent post, and today, the stock just tanked after missing revenue numbers, so I officially bought a 1/2 position. The tricky part is if I had bought the call option, I'd be down ~20%, but at the same time, I still like the story and like the stock even better down 6%. I am slowly understanding the need for patience, yet the need for action--if there is one constant in investing, it is the juxtaposition of very powerful emotions (fear vs. greed; patience vs. action).
So, bought $100 worth of BCR in my folioFN account (1.2 shrs or so) and will be looking to add more if the stock falls to ~$77. A 12% stop loss would be around $60, but would not be known until the second 1/2 of the position is bought.
Crazy times...
Masterjaz out
So, bought $100 worth of BCR in my folioFN account (1.2 shrs or so) and will be looking to add more if the stock falls to ~$77. A 12% stop loss would be around $60, but would not be known until the second 1/2 of the position is bought.
Crazy times...
Masterjaz out
Monday, October 22, 2007
Alert and a candidate
Thanks the to monster gap down this mornig followed by a nice fill, I would've received a nice trade/investment in BCR. Found the 70 Jan 09 call for $20.05. Sadly, there was no open interest for the Apr 08 calls, so I would've paid a little more for the LEAP. On the flipside, these are set up to be longer term trades and if BCR appreciates as I would expect, then the longer dated option is actually a blessing...
Now for the canididate, LIFC. It has been a runner of late, but just tanked today. Too bad I did not know about it prior to the Barchart downgrade after the close. At one point the stock was down >10%. Calls would've been the perfect trade. I would only consider a call if the stock drops to 36.75. This is another stock with no open interest for Jun 08, so Jan 09 LEAPS may be a better buy. An interesting fact: 20 Jan 09 call is $22.50 while 30 Jan 09 call is $15. With a closing price of $40.63, it would actually be cheaper (i.e. less time value) to buy the deeper in the money calls, although it would require more money up front...
The LIFC+BCR trades have shown something important. If I do end up going to LEAPS, the deeper in the money, the less time value (a given by definition), but the less leverage. It is something I will track going forward. I usually look for the smallest premium that gives a delta of 90 or so, but the trade off in time value may be important...
For now,
Masterjaz out
Now for the canididate, LIFC. It has been a runner of late, but just tanked today. Too bad I did not know about it prior to the Barchart downgrade after the close. At one point the stock was down >10%. Calls would've been the perfect trade. I would only consider a call if the stock drops to 36.75. This is another stock with no open interest for Jun 08, so Jan 09 LEAPS may be a better buy. An interesting fact: 20 Jan 09 call is $22.50 while 30 Jan 09 call is $15. With a closing price of $40.63, it would actually be cheaper (i.e. less time value) to buy the deeper in the money calls, although it would require more money up front...
The LIFC+BCR trades have shown something important. If I do end up going to LEAPS, the deeper in the money, the less time value (a given by definition), but the less leverage. It is something I will track going forward. I usually look for the smallest premium that gives a delta of 90 or so, but the trade off in time value may be important...
For now,
Masterjaz out
Wednesday, October 17, 2007
Another
Just as I finished my last post, bang, another alert. This time for AME. Call option play would be $35 Mar 08 @ $9.25 (huge spread) giving a extrinsic value of ~3.8%. A little high for my taste. I will look at the stock in the AM to see. Alert was for $42.50, stock bounced right off that value, but still has time to drift lower...
For now,
Masterjaz out
For now,
Masterjaz out
Killer day...
Can you say 'bull trap'? What a reversal in today's market after seemingly good earnings news from techland and JPM. Oh well, I did get a couple alerts when the markets dived right before 2pm (est).
One is really intriguing: HCBK, I set an alert at $14.85 and the stock ultimately hit $14.74. What is most interesting is that I checked and paper traded a single $10 April 08 call contract. The average between bid/ask was $5 even. So for an ~$0.15 time premium, I would control 100 shares HCBK until the end of 1Q08. Interesting...
The second alert was for JLL, the call options were crazy expensive $90 Mar 08 going for $16.55 (huge spread) with a stock price of ~$95.20. An $11 time premium just doesn't work for me. I would like to keep the extrinsic value below 3% of the stock price. Nonetheless, the stock may be a good buy for my standard folioFN trading...The alert was for $95 even and the stock ultimately touched $94.89. I'll revisit the stock tomorrow before the AM trade window and see if I want to jump in.
For now,
Masterjaz out
One is really intriguing: HCBK, I set an alert at $14.85 and the stock ultimately hit $14.74. What is most interesting is that I checked and paper traded a single $10 April 08 call contract. The average between bid/ask was $5 even. So for an ~$0.15 time premium, I would control 100 shares HCBK until the end of 1Q08. Interesting...
The second alert was for JLL, the call options were crazy expensive $90 Mar 08 going for $16.55 (huge spread) with a stock price of ~$95.20. An $11 time premium just doesn't work for me. I would like to keep the extrinsic value below 3% of the stock price. Nonetheless, the stock may be a good buy for my standard folioFN trading...The alert was for $95 even and the stock ultimately touched $94.89. I'll revisit the stock tomorrow before the AM trade window and see if I want to jump in.
For now,
Masterjaz out
Huge update...
Consistanty inconsistant, it is the name of my game. Glad that nobody reads this blog! Okay, I bought a half position in DCI after it hit my $40.80 target and will be adding to the position if it ever sees $38.50 (maybe...).
Found 3 candidates a few days back (sorry I don't remember the exact day): HWAY, HCBK, and BCR. I can go thru the candidates one by one at another time to put down what I see and why I like them.
And yesterday after the close I found 2 more candidates: HDB and TRAK. I am not completely confident in TRAK and HDB is recovering huge on Wednesday so I don't expect to get a decent entry. Nonetheless, I want to put the information out there and I'll update with details later.
Finally, I am considering playing these candidates in a new way: deep in the money calls. I have been researching the method and am finding things I like and things I don't. Of course the biggest problem is the limited time (except if the stock is optionable with LEAPS) and the decay in time value/extrinsic value. It is something I'm paper trading and will have an idea later whether it is a go or no go. Bascially, I have a small account that I am going to transfer and have the ability to trade options and like the idea of limited but useful leverage.
For now,
Masterjaz out
Found 3 candidates a few days back (sorry I don't remember the exact day): HWAY, HCBK, and BCR. I can go thru the candidates one by one at another time to put down what I see and why I like them.
And yesterday after the close I found 2 more candidates: HDB and TRAK. I am not completely confident in TRAK and HDB is recovering huge on Wednesday so I don't expect to get a decent entry. Nonetheless, I want to put the information out there and I'll update with details later.
Finally, I am considering playing these candidates in a new way: deep in the money calls. I have been researching the method and am finding things I like and things I don't. Of course the biggest problem is the limited time (except if the stock is optionable with LEAPS) and the decay in time value/extrinsic value. It is something I'm paper trading and will have an idea later whether it is a go or no go. Bascially, I have a small account that I am going to transfer and have the ability to trade options and like the idea of limited but useful leverage.
For now,
Masterjaz out
Thursday, October 11, 2007
Candidate from Wednesday...
Found DCI using the usual Barchart Downgrade method, but have been more selective in actively investing in candidates (and I am glad). Stock has perfect fundis, growing sales, income, EPS, dividend, debt (boo), a flat to declining share count, stable margins, and good institutional ownership. All-in-all, I like the stock, but am also concerned about buying ad hoc. Looking at the chart, set an initial level of $40.80 and an all-in level of $38.50. Of course, the stock bounced right off $40.80 today, so I'll have to see how things are looking on Friday before committing funds.
That's all for now, no candidates on Thursday,
Aaron
That's all for now, no candidates on Thursday,
Aaron
Tuesday, October 09, 2007
Tuesday downgrade buy...
Placed a trade Tuesday after a multiply downgraded stock found some support and the fundamentals supported a buy. MCHP is the stock and it dropped >10% due to weak guidance and two downgrades (to neutral...). The fundamentals are sound, growing sales, growing net income, EPS, no debt, slight share dilution, growing margins (likely to retract some...), and a very nice divy to boot (also provides yield support).
Bought half position at ~$32 with the possibility of adding at $31 if it goes that low. The chart looks okay, not great...
For now,
Masterjaz out
Bought half position at ~$32 with the possibility of adding at $31 if it goes that low. The chart looks okay, not great...
For now,
Masterjaz out
Stock from Monday 10-08...
Good candidate in SSYS, like all the info and the business. Nice small cap name with increasing sales, net income, EPS, reasonably stable margins (with enough growth to 'hide' any margin contraction leading to growing year-over-year EPS), and no debt. Marginally high share count dilution, but for a company in this space it is not surprising and EPS growth still outpasses dilution. Institutional ownership is huge, but with 20% shares short, it is probable some of the ownership is overcounted. Also read: possible short squeeze with good earnings in the next couple quarters...
The chart worries me a little, the stock has doubled in the past year and I am always concerned finding candidates at the top. I am waiting for a pullback to $26 (50dma) before considering taking a position. I would consider a pullback to $23 reasonable as there is huge support and it would bring P/E down to a more mangable level. I would have to recify how to handle a pullback that deep as my traditional 7.5% stop loss on $26 is $24.05...I'll worry about crossing that bridge if I ever reach it.
For now, my alert is set and I am waiting.
Masterjaz out
The chart worries me a little, the stock has doubled in the past year and I am always concerned finding candidates at the top. I am waiting for a pullback to $26 (50dma) before considering taking a position. I would consider a pullback to $23 reasonable as there is huge support and it would bring P/E down to a more mangable level. I would have to recify how to handle a pullback that deep as my traditional 7.5% stop loss on $26 is $24.05...I'll worry about crossing that bridge if I ever reach it.
For now, my alert is set and I am waiting.
Masterjaz out
