September 25, 2024
Position Update – Walmart (WMT)
While I am not someone who takes profits at round numbers, I did want to bring to your attention that Walmart (WMT) is trading at a new high today, and our January 65 calls are now at a potential profit of 300%.
Also of note, while not a monster premium paid, this trade from this morning is interesting as a trader sees further upside to come for WMT shares:
Buyer of 36,500 Walmart (WMT) January 100/105 Bull Call Spreads for $0.14 – Stock at 81
Again, paying $0.14 is hardly a monster buy, though it is an interesting trade given the strong stock action and steady wave of upgrades of WMT stock as of late.
Stepping back, I am going to continue to hold my calls … though if you wanted to ring the register on your trade for a 300% gain that is a fine choice as well.
September 24, 2024
Position Update – Unity Software (U)
There is no stock that I track that has attracted such a steady flow of bullish option activity more than Unity Software (U). This action started before earnings, continued after the earnings disaster, and has ramped even more aggressively as the stock has made new recent highs. Here are some of those trades made in the last two days:
Today - Buyer of 5,000 Unity Software (U) November 20 Calls for $3.40 – Stock at 21.8
Today - Buyer of 5,000 Unity Software (U) October 20 Calls for $2.50 – Stock at 21.65
Today - Buyer of 10,000 Unity Software (U) January 15 Calls for $7.70 – Stock at 21.8
Yesterday - Buyer of 5,000 Unity (U) November 20 Calls for $3.20 – Stock at 21.5
As you might imagine, I am going to continue to hold our position as I think the stock action and option activity are pointing to more new highs.
That being said, this is a high short-interest stock which means there are plenty of traders betting against it … though conversely, if those shorts are forced to cover, this stock could go crazy to the upside.
Regardless, I wanted to bring this strong option activity to your attention and update you that our calls are now at a potential profit of approximately 45%. This has been a heck of a ride!
September 23, 2024
Weekly Update
As I noted last week, because of family travel this Monday’s update is focused on our open positions. Let’s dive in …
Robinhood (HOOD) January 15/26 Bull Call Spread – HOOD has roared back to life in the last two weeks which a is great situation for our January 15 calls that are now back at a big profit.
Hewlett Packard (HPE) January 22 Calls – HPE has bounced back nearly $3 from its post-earnings lows, which is great. That being said, we do need the stock closer to 22 before we get too excited.
Of note, on Tuesday Bank of America upgraded HPE with a price target of 23, and that day a trader bought 5,000 Hewlett Packard (HPE) October 18.5 Calls (exp. 10/11) for $0.47 – Stock at 18.3.
Lyft (LYFT) October 13 Covered Call – LYFT continued its slow and steady rally last week, which is perfect for our covered call trade. Of note. on Tuesday a trader bought 3,000 Lyft (LYFT) October 13 Calls for $0.60 – Stock at 12.25.
Marijuana ETF (MSOS) Stock – The MSOS September 9 call that we had sold expired worthless on Friday which means we are left with our stock position today. I will be looking for a new call to sell if the price is right.
On Holding (ONON) January 42.5 Calls – On Thursday we sold a piece of our ONON calls for a profit of 75%. My plan is to let the final piece run for as big a profit as we can squeeze out of the position.
Oracle (ORCL) March 160 Calls – ORCL has been more volatile than I had imagined, but big picture the stock is just below its all-time high and looks great. Our recently purchased position is in good shape.
Palantir (PLTR) January 26/45 Bull Call Spread – PLTR continues to look spectacular and a leader in the AI space. Our position is in great shape, and of note option activity continues to be bullish, including this trade from Tuesday: Buyer of 5,000 Palantir (PLTR) February 35 Calls for $6.10 – Stock at 36.4.
Nasdaq ETF (QQQ) November 430 Puts – Now that the Fed announcement is behind us, the last remaining “known” event for our bear put spread is the election. Hopefully this insurance policy never pays off.
Rocket (RKT) March 20 Calls – RKT was our most disappointing position as last week as I would have thought that a 50-basis point interest rate cut would be a big win for the stock. That wasn’t the case in the short term … though I continue to think it will be in the longer term.
Unity Software (U) December 18 Calls – U ripped to a new recent high last week and we took advantage of that stock strength to lock in an initial profit of 23%. Let’s see how the stock trades in the days/weeks to come.
Walmart (WMT) January 65 Calls – WMT gave up a bit of ground last week following the Fed, but it still looks great. Of note, on Tuesday Morgan Stanley wrote “Walmart+ membership reached a record high in August .. the largest sequential increase in membership since the onset of our survey and is ~30% higher than the prior 6-month average.”
Copyright © 2024. All rights reserved. Copying or electronic transmission of this information without permission is a violation of copyright law. For the protection of our subscribers, copyright violations will result in immediate termination of all subscriptions without refund. Disclosures: Cabot Wealth Network exists to serve you, our readers. We derive 100% of our revenue, or close to it, from selling subscriptions to our publications. Neither Cabot Wealth Network nor our employees are compensated in any way by the companies whose stocks we recommend or providers of associated financial services. Employees of Cabot Wealth Network may own some of the stocks recommended by our advisory services. Disclaimer: Sources of information are believed to be reliable but they are not guaranteed to be complete or error-free. Recommendations, opinions or suggestions are given with the understanding that subscribers acting on information assume all risks involved. Buy/Sell Recommendations: are made in regular issues, updates, or alerts by email and on the private subscriber website. Subscribers agree to adhere to all terms and conditions which can be found on CabotWealth.com and are subject to change. Violations will result in termination of all subscriptions without refund in addition to any civil and criminal penalties available under the law.
