Post-Earnings Options Success
Yesterday morning, a focus in our premarket report on Caterpillar and McDonald’s options proved to be a big success. Both companies exceeded expectations on their delivered earnings reports, and early activity suggested that opportunity was in the air.
We signaled multiple contracts for each of them, and no matter which chain and strike price was chosen, respectable intraday profits were there for the taking. The specific ideas we highlighted were the CAT Weekly $111-114 Calls, and the MCD Weekly $152.50 &155 Calls, and their subsequent moves were as follows:
Caterpillar, Inc. CAT
$111 Calls – Range: 2.00-3.88 – Max Gain: 94%
$112 Calls – Range: 1.36-2.88 – Max Gain: 112%
$113 Calls – Range: .85-2.15 – Max Gain: 153%
$114 Calls – Range: .58-1.44 – Max Gain: 148%
McDonald’s Corp. MCD
$152.50 Calls – Range: 4.35-7.50 – Max Gain: 72%
$155 Calls – Range: 2.15-5.00 – Max Gain: 133%
We’re seeing marginal premarket pullbacks from each stock this morning, but will continue to keep an eye on these play as we head into week’s end.
Added Options Notes: Speaking of the end of the week, we’ve got an onslaught of big name earnings releases coming tomorrow and Friday, so expect the options intensity to ramp up quickly. We;ve got some fresh ideas today as well:
We also want to begin tracking a set of contracts in Chipotle Mexican Grill, Inc. CMG. We’ve been watching the stock get hammered down for the better part of the last two months, and yesterday it gave the reversal signal we’ve been looking for.Others have caught on as well, with the stock surging in premarket trading this morning. We’re going to be watching the CMG 8/11 $360-370 Calls.
Additionally, we’re also noticing a cherry of a chart setup on The Hershey Co. HSY, which, when paired with a big time beat on their own Q2 earnings, should make for a decent rebound. We’ll be staying on top of the HSY 08/18 $110 & 111 Calls.
AK Steel Holding Corp. AKS
We’ll also continue to keep an eye on AKS, which we tagged in yesterday’s report. The stock did rise, if only slightly (6.35-6.88), so we’ll want to track it for a more sustained run. It’s already trading above its 20 and 50-day moving averages- next we’d like to see it make a run at the 200DMA at 7.44.
PETX, IFON, OCUL, HMNY