In case you hadn't noticed lately, the most substantive posts on things like SPX EPS, oil, unemployment and the like have been conspicuously absent. Real life obligations and requirements have a knack of hoovering up time.
So, I'll try to resume the regular NYMEX updates and such next week maybe. And the earnings post should (hopefully) resume next Sunday. Apologies to anyone who missed it, though inferring from the lack of notes in my inbox that couldn't have been too many of you!
Monday, May 4, 2009
Sunday, April 26, 2009
Earnings Week of 4/27
Here's the week's earnings spreadsheet:
Spreadsheet Link
Another week with tons of earnings. Too many for commentary, plus I'm under-the-weather today so the spreadsheet will stand on its own again. One note: I boosted the threshold minimum on prior month option activity to 5000 to filter out some of the low-liquidity earnings reports. These types often aren't worth playing anyway since it's hard to trade out of them.
Spreadsheet Link
Another week with tons of earnings. Too many for commentary, plus I'm under-the-weather today so the spreadsheet will stand on its own again. One note: I boosted the threshold minimum on prior month option activity to 5000 to filter out some of the low-liquidity earnings reports. These types often aren't worth playing anyway since it's hard to trade out of them.
Sunday, April 19, 2009
Earnings Week of 4/20
Here's the week's earnings spreadsheet:
Spreadsheet Link
Notice: Google docs is not allowing me to upload the spreadsheet for some reason. Apparently, they caught the Yahoo bug. I'll try again in an hour or so to upload it. Keep your fingers crossed!
Update: Google docs is functioning again. Not sure what exactly the problem was. However, it's now late and I don't have time for a full-on analysis. I'll try to do one tomorrow. Suffice to say that there are a TON of companies big and small this week. One note on the filtering... there were so many on the 23rd that they were overflowing the number of lines that I had created the IV approximation and other queries for. So, I limited the parameters further to a prior month option volume of 5000 and a minimum share price of 7.50. The results are on the tab 0423-B. The other tabs use the standard 2500 volume and > $5 share price. My apologies for the lack of commentary.
Buckle up for the week and be careful!
Spreadsheet Link
Update: Google docs is functioning again. Not sure what exactly the problem was. However, it's now late and I don't have time for a full-on analysis. I'll try to do one tomorrow. Suffice to say that there are a TON of companies big and small this week. One note on the filtering... there were so many on the 23rd that they were overflowing the number of lines that I had created the IV approximation and other queries for. So, I limited the parameters further to a prior month option volume of 5000 and a minimum share price of 7.50. The results are on the tab 0423-B. The other tabs use the standard 2500 volume and > $5 share price. My apologies for the lack of commentary.
Buckle up for the week and be careful!
Sunday, April 12, 2009
Earnings Week of 4/13
Here's the week's earnings spreadsheet:
Spreadsheet Link
Monday Update: Welcome Evil Speculator visitors. Someone over there linked to this entry and all of a sudden site traffic is up. Anyhow, to read a bit of background about the spreadsheet and what it is and isn't as well as a bit of history, go here: Earnings Spreadsheet Explanation. This is a weekly thing, posted some time on Sunday (And lately, the only thing that gets posted regularly.) You can click on the dated tabs in the window above to see the different days. Here's the rest of the original post:
Quick look at last week: AA gapped up, faded and then gapped up again the next session. I'd call this a negative because unless you had considerable confidence to fade that initial spike, you'd have taken a loss. However, the vertical spreads on BBBY were a great play as it gapped up about 18% and continued upward. Keep an eye out for these "survival of the fittest" plays like BBY/CC and BBBY/LNT. FDO also did quite well and JOSB did get above that resistance and then bolted. So all in all, not a bad week in retrospect.
Unfortunately, I am tardy getting this update out as I had those dreaded "real life" committments to attend to this easter weekend. This is also going to curtail my standard commentary. Fortunately, there were no releases that made it through the filter for Monday so that's kind of helpful. I'd say that I'd like to post a mid-week update but my posting frequency as of late has been dismal so I'll not make an unlikely promise. Instead here's a brief overview of what's to come...
1st - This is an op-ex week.
2nd - The "Golden Boys" of finance - JPM and GS announce earnings. (Disclosure: long JPM shares, covered calls). I've often noted the ridiculousness of financial earnings likening them to kabuki theatre. WFC's out-of-the-park announcement last week should help people realize that when you get to borrow money from someone at nearly zero rates, then lend them the same money at 4.5% and charge them a fee to make the loan, that to recover, all you need is time. Consider also that GS is considering an equity offering to pay off TARP. Having long ago passed into bizarre-o world, the potential dilution from Warren B's warants and another offering in the works means that GS will likely go to the Moon.
3rd - Faux-financial GE is Friday. GE recently lost its AAA rating from Moody's (BRK lost it a few days later, leaving on 4 companies left with AAA).
Check over the spreadsheet, there are a number of big names on there. Tuesday has INTC, JNJ and GS. Wednesday has ABT, and a key semiconductor equipment supplier ASML. (Yes, finally a mention of a player in that sector.) Thursday has several biotech names (AMLN, BIIB, VRTX) along with GOOG, JPM, NOK. I'll throw ISRG a mention as well since it has often been volatile. Friday rounds out the week with GE and MAT.
That's it for this week. Surprisingly, short interest is higher than I would have expected though that could just be an artifact of Yahoo delays in data reporting. Who knows - at least their sites worked this week.
Spreadsheet Link
Monday Update: Welcome Evil Speculator visitors. Someone over there linked to this entry and all of a sudden site traffic is up. Anyhow, to read a bit of background about the spreadsheet and what it is and isn't as well as a bit of history, go here: Earnings Spreadsheet Explanation. This is a weekly thing, posted some time on Sunday (And lately, the only thing that gets posted regularly.) You can click on the dated tabs in the window above to see the different days. Here's the rest of the original post:
Quick look at last week: AA gapped up, faded and then gapped up again the next session. I'd call this a negative because unless you had considerable confidence to fade that initial spike, you'd have taken a loss. However, the vertical spreads on BBBY were a great play as it gapped up about 18% and continued upward. Keep an eye out for these "survival of the fittest" plays like BBY/
Unfortunately, I am tardy getting this update out as I had those dreaded "real life" committments to attend to this easter weekend. This is also going to curtail my standard commentary. Fortunately, there were no releases that made it through the filter for Monday so that's kind of helpful. I'd say that I'd like to post a mid-week update but my posting frequency as of late has been dismal so I'll not make an unlikely promise. Instead here's a brief overview of what's to come...
1st - This is an op-ex week.
2nd - The "Golden Boys" of finance - JPM and GS announce earnings. (Disclosure: long JPM shares, covered calls). I've often noted the ridiculousness of financial earnings likening them to kabuki theatre. WFC's out-of-the-park announcement last week should help people realize that when you get to borrow money from someone at nearly zero rates, then lend them the same money at 4.5% and charge them a fee to make the loan, that to recover, all you need is time. Consider also that GS is considering an equity offering to pay off TARP. Having long ago passed into bizarre-o world, the potential dilution from Warren B's warants and another offering in the works means that GS will likely go to the Moon.
3rd - Faux-financial GE is Friday. GE recently lost its AAA rating from Moody's (BRK lost it a few days later, leaving on 4 companies left with AAA).
Check over the spreadsheet, there are a number of big names on there. Tuesday has INTC, JNJ and GS. Wednesday has ABT, and a key semiconductor equipment supplier ASML. (Yes, finally a mention of a player in that sector.) Thursday has several biotech names (AMLN, BIIB, VRTX) along with GOOG, JPM, NOK. I'll throw ISRG a mention as well since it has often been volatile. Friday rounds out the week with GE and MAT.
That's it for this week. Surprisingly, short interest is higher than I would have expected though that could just be an artifact of Yahoo delays in data reporting. Who knows - at least their sites worked this week.
Sunday, April 5, 2009
Earnings Week of 4/6
Here's the week's earnings spreadsheet:
Spreadsheet Link
First, a functional note. Or rather, a disfunctional one. Yahoo is having trouble with another aspect of their finance data. This time the screener won't return data so the the ownership information is stale. Keep this in mind and check your broker for the actual short percentages.
Last week I did a little summary of the week prior and since my other thought on filling this space is of the "misty philosophical rambling essay" variety, I think I'll just stick to a wrap-up. The web is full of blogs with those kinds of entries. So... how did I do last week? First, the OK:
APOL - I thought it would be volatile, but not volatile enough. It ended up dropping like a stone but didn't breach the break-even price in my table. It has since found support on the DMA(200).
MON - My gut feeling was for a return to 80. It closed the week at 81.41 and saw 80 on Thursday and Friday. This still has a nice chart with support from the DMA(30&50) around 79.40 and it might be good to watch with MOS coming out this week.
KMX/MDRX - neither would have been profitable strangles.
The not so good: RIMM - oy... it was profitable and my underestimation of its strength was obvious.
So on to this week's earnings releases:
Monday - BLUD. Biotechs tend to move more on news than earnings. And I don't really know anything about their products.
Tuesday - Earnings season is upon us with AA's release. Also on this day are BBBY and MOS. AA has been beaten badly though it is still well off its March lows - 60% up in fact. I'd guess that a short-weighted strategy would be the highest odds. BBBY has lost one of its major competitors as Linens & Things went BK. I believe this will have a similar impact as BBY and CC. BBBY's chart is looking good and it shot over the 200 DMA on strong volume over Thursday and Friday. Historically, BBBY has not moved much at earnings so a strangle might not be wise here. But I'd be tempted to go with a vertical call spread. Finally, MOS: as noted MON was last week and reaction was lukewarm. MOS has a somewhat more bullish chart and it has certainly made large moves in the past. But 53 on the upside seems out of reach to me so I think I'll avoid this one.
Wednesday - FDO is the only one that really interests me. I've had some success with the Dollar Store and this one before. And as before, if FDO can't make money in this economy it never will. In this case, watching to see the action before the release will be important since it's riding an upward sloping support. If that fails - it wouldn't surprise me to see FDO fill the gap back to early March over the next month.
Thursday - DJI component CVX releases. It is about 7% of the DJI now that some of the more embarrassing components have regained some respect. This one won't move a lot but it is a huge company and worth listening to what they have to say. JOSB is very close to a break-out point around 32. If it gets past this, it could bolt. Otherwise, I'd put downside support at 26, which is well above the lower break-even price.
Spreadsheet Link
First, a functional note. Or rather, a disfunctional one. Yahoo is having trouble with another aspect of their finance data. This time the screener won't return data so the the ownership information is stale. Keep this in mind and check your broker for the actual short percentages.
Last week I did a little summary of the week prior and since my other thought on filling this space is of the "misty philosophical rambling essay" variety, I think I'll just stick to a wrap-up. The web is full of blogs with those kinds of entries. So... how did I do last week? First, the OK:
APOL - I thought it would be volatile, but not volatile enough. It ended up dropping like a stone but didn't breach the break-even price in my table. It has since found support on the DMA(200).
MON - My gut feeling was for a return to 80. It closed the week at 81.41 and saw 80 on Thursday and Friday. This still has a nice chart with support from the DMA(30&50) around 79.40 and it might be good to watch with MOS coming out this week.
KMX/MDRX - neither would have been profitable strangles.
The not so good: RIMM - oy... it was profitable and my underestimation of its strength was obvious.
So on to this week's earnings releases:
Monday - BLUD. Biotechs tend to move more on news than earnings. And I don't really know anything about their products.
Tuesday - Earnings season is upon us with AA's release. Also on this day are BBBY and MOS. AA has been beaten badly though it is still well off its March lows - 60% up in fact. I'd guess that a short-weighted strategy would be the highest odds. BBBY has lost one of its major competitors as Linens & Things went BK. I believe this will have a similar impact as BBY and CC. BBBY's chart is looking good and it shot over the 200 DMA on strong volume over Thursday and Friday. Historically, BBBY has not moved much at earnings so a strangle might not be wise here. But I'd be tempted to go with a vertical call spread. Finally, MOS: as noted MON was last week and reaction was lukewarm. MOS has a somewhat more bullish chart and it has certainly made large moves in the past. But 53 on the upside seems out of reach to me so I think I'll avoid this one.
Wednesday - FDO is the only one that really interests me. I've had some success with the Dollar Store and this one before. And as before, if FDO can't make money in this economy it never will. In this case, watching to see the action before the release will be important since it's riding an upward sloping support. If that fails - it wouldn't surprise me to see FDO fill the gap back to early March over the next month.
Thursday - DJI component CVX releases. It is about 7% of the DJI now that some of the more embarrassing components have regained some respect. This one won't move a lot but it is a huge company and worth listening to what they have to say. JOSB is very close to a break-out point around 32. If it gets past this, it could bolt. Otherwise, I'd put downside support at 26, which is well above the lower break-even price.
Sunday, March 29, 2009
Auto Sales and Vehicles per Driver
Over at Calculated Risk there have been several posts on the auto sales numbers as that data has been released. CR's take (link to the latest post: HERE) has been that the fleet turnover ratio, currently at a record 26.8 years is unsustainable and believes that the correction in this value will take the form of an uptick in auto sales rather than a decrease in the fleet size. The comments have been in disagreement with this outlook far more than is typical for a post over there. The comments section has typically evolved into a "I've got a 1982 Honda that I've driven around the world 18 times and expect it to make another 2 trips," sort of thing. Not exactly hard evidence. There was one comment in the last string about 2 car families becoming 1 car families. This is far more interesting.
I decided to try to dig up the data on licensed drivers and the registered vehicles to see if there has been a change in the ratio or anything that would remotely resemble a historical "norm.
Here are the charts: the first one containing the data on licensed drivers, passenger cars and trucks along with one line combining those last two. Motorcycles are omitted because in the more recent sources they are not found broken out separately as in the earlier reports. (See the source links at bottom.) Also note that until 1990, the year axis is ticked off in increments of 5 years and then in 1 year increments.
The second chart shows the ratios of passenger cars to licensed drivers and passenger cars + trucks to licensed drivers over the same period. Early on in these data sets, there is a shift in the categorization of trucks and so these early points are omitted. I don't think it matters in the final analysis anyway.
One interesting thing is the decline in passenger cars and the rise in the cars + trucks ratio. I am assuming this represents the change in vehicle mix as the SUV came to be such a dominant class. However, I did not dig very deep into the specifics of the classifications in this case. The most important thing to note is that the ratio of vehicles to drivers is greater than 1 and the 2007 ratio stood at 1.19 vehicles per driver in the US. In 2001 (the last data I can find), the percentage of households with 3 or more vehicles in the US was 23.6%.
If there really is a new sense of frugality that creeps into the American household budget it does not take a great leap to imagine that the ratio of vehicles to drivers might actually fall back closer to 1. This could get even worse if the low interest credit that the automakers have been providing courtesy of the government disappears since it seems very likely that consumer credit is going to be significantly reduced in the coming year. (And justifiably so.) At any rate, simply because the fleet turnover rate has reached a hitherto unknown height does not necessarily imply that auto sales will push up. I think the data and change in patterns argues for a much closer examination of the possibility that the vehicle fleet is reduced.
I decided to try to dig up the data on licensed drivers and the registered vehicles to see if there has been a change in the ratio or anything that would remotely resemble a historical "norm.
Here are the charts: the first one containing the data on licensed drivers, passenger cars and trucks along with one line combining those last two. Motorcycles are omitted because in the more recent sources they are not found broken out separately as in the earlier reports. (See the source links at bottom.) Also note that until 1990, the year axis is ticked off in increments of 5 years and then in 1 year increments. 
The second chart shows the ratios of passenger cars to licensed drivers and passenger cars + trucks to licensed drivers over the same period. Early on in these data sets, there is a shift in the categorization of trucks and so these early points are omitted. I don't think it matters in the final analysis anyway. One interesting thing is the decline in passenger cars and the rise in the cars + trucks ratio. I am assuming this represents the change in vehicle mix as the SUV came to be such a dominant class. However, I did not dig very deep into the specifics of the classifications in this case. The most important thing to note is that the ratio of vehicles to drivers is greater than 1 and the 2007 ratio stood at 1.19 vehicles per driver in the US. In 2001 (the last data I can find), the percentage of households with 3 or more vehicles in the US was 23.6%.
If there really is a new sense of frugality that creeps into the American household budget it does not take a great leap to imagine that the ratio of vehicles to drivers might actually fall back closer to 1. This could get even worse if the low interest credit that the automakers have been providing courtesy of the government disappears since it seems very likely that consumer credit is going to be significantly reduced in the coming year. (And justifiably so.) At any rate, simply because the fleet turnover rate has reached a hitherto unknown height does not necessarily imply that auto sales will push up. I think the data and change in patterns argues for a much closer examination of the possibility that the vehicle fleet is reduced.
Earnings Week of 3/30
Here's the week's earnings spreadsheet:
Spreadsheet Link
This is a relatively light week with only a couple of names worth paying attention to so I'm going to stick a little recap of last week's action in here. Kind of a "Keepin' Score Lite" post for those that have been reading long enough to remember those posts.
Last week, I got a few things correct and few things sort of off.
First the correct stuff:
- Pointed out IV was too high for FMCN to make a profit. Result: peak price about 1.20 below B/E price.
- WSM did get above the 10 mark and spiked up ever so briefly to 12.36 before falling back.
- RHT looked interesting and it closed the week at 16.99 above the strangle B/E of 16.30 and at one point had reached 17.80.
- GME, if you had a long-weighted position you would have done fine as it peaked out at 28.45 just above the B/E price of 28.05 for a neutral position.
- I thought TXI was priced perfectly on the downside but had some wiggle room for profitability on the upside. It benefitted from a strong run and closed the week at 25.10 - well above the B/E price of 20.07.
Things I didn't do so well on:
- I thought TIF had peaked out, but it pushed upward and broke past the DMA(50).
- I didn't think WAG had very good odds to be profitable and it would have been.
- Similarly, I felt CCL wasn't worth the time but it came within a penny of the B/E price in the sheet.
- Not really sure how I managed to overlook BBY last week but that was a stupid, stupid move on my part. I would have treated that like GME given my ongoing thesis that the liquidation of CC has been like BBY buying outs its biggest competitor at zero cost. Hindsight is 20/20 but that's pretty disappointing for me.
So has the rally played out? I mentioned to someone in the middle of this past week that 666 * 1.25 = 832.5 so that was my target for the local maxima. The peak of SPX this week was 832.98. Obviously, it's a bit premature to declare the top here it does fit with the KISS idea of theories - Keep It Simple, Stupid. We'll see, but suffice to say longs are hedged and I am looking for more downside in the coming week, even if it is just a pullback to the DMA(50) around 790.
Anyway, as mentioned earlier the number of earnings releases this week is small. But here they are anyway. One important note: Yahoo! is providing yet another reason why their share price deserves to be where it is today. Again, the data reporting on the options has been dicey and in several instances the puts are intermixed with the calls. I have tried to manually correct, but I think in a few cases I have missed some so be aware.
Monday - SNP. I've mentioned many times on here that I don't like/trust ADR/ADS because of their even worse overseas regulation. The exception would be a company like STO because of its location in Norway. Who doesn't trust Norwegians? At any rate, I am not going to make a comment either way here because I've seen screwy patterns and volume many times in the past.
Tuesday - I think APOL will be volatile, just not volatile enough. Same thing for GIGM. ACH is another Chinese ADR. LEN... a 40% move seems a bit much to ask of any stock in this environment.
Wednesday - nothing. Probably because no bank wants to have their earnings on April Fool's Day. It's just too easy to make jokes. I'm sure LOLFed is sad.
Thursday - Two big companies MON and RIMM. I'll take MON first. Current pricing has an average absolute move of 11.25 which is well within the performance of the last two quarters considering the moves of +19.22% and +18.38% respectively. However, it just moved up from the 80 level and just like the rest of the market has moved basically 25% in 2 weeks time. It's difficult to imagine how much room is left on the upside especially with the DMA(200) looming at 93.20. MON has not been above DMA(200) since October. My two cent gut feeling is a return to 80. Now for RIMM, which is up about 22% give or take in the same period of time. The way that the spreadsheet calculates its break-evens is on a gap in strikes but even buying both at 45 still is no guarantee of success. The downside B/E ends up at 37.90 which is virtually the trough before the latest run and to move up requires a big bounce above the DMA(50). It's certainly not impossible - RIMM has made moves like this in the past - but it seems more unlikely this time around with the indices appearing to hit a local maxima. Of the other two on this day, KMX has shot up about 40% and MDRX about 25%. It seems unlikely that either of these two will be profitable strangles.
Friday - nothing made it through the screen.
Spreadsheet Link
This is a relatively light week with only a couple of names worth paying attention to so I'm going to stick a little recap of last week's action in here. Kind of a "Keepin' Score Lite" post for those that have been reading long enough to remember those posts.
Last week, I got a few things correct and few things sort of off.
First the correct stuff:
- Pointed out IV was too high for FMCN to make a profit. Result: peak price about 1.20 below B/E price.
- WSM did get above the 10 mark and spiked up ever so briefly to 12.36 before falling back.
- RHT looked interesting and it closed the week at 16.99 above the strangle B/E of 16.30 and at one point had reached 17.80.
- GME, if you had a long-weighted position you would have done fine as it peaked out at 28.45 just above the B/E price of 28.05 for a neutral position.
- I thought TXI was priced perfectly on the downside but had some wiggle room for profitability on the upside. It benefitted from a strong run and closed the week at 25.10 - well above the B/E price of 20.07.
Things I didn't do so well on:
- I thought TIF had peaked out, but it pushed upward and broke past the DMA(50).
- I didn't think WAG had very good odds to be profitable and it would have been.
- Similarly, I felt CCL wasn't worth the time but it came within a penny of the B/E price in the sheet.
- Not really sure how I managed to overlook BBY last week but that was a stupid, stupid move on my part. I would have treated that like GME given my ongoing thesis that the liquidation of CC has been like BBY buying outs its biggest competitor at zero cost. Hindsight is 20/20 but that's pretty disappointing for me.
So has the rally played out? I mentioned to someone in the middle of this past week that 666 * 1.25 = 832.5 so that was my target for the local maxima. The peak of SPX this week was 832.98. Obviously, it's a bit premature to declare the top here it does fit with the KISS idea of theories - Keep It Simple, Stupid. We'll see, but suffice to say longs are hedged and I am looking for more downside in the coming week, even if it is just a pullback to the DMA(50) around 790.
Anyway, as mentioned earlier the number of earnings releases this week is small. But here they are anyway. One important note: Yahoo! is providing yet another reason why their share price deserves to be where it is today. Again, the data reporting on the options has been dicey and in several instances the puts are intermixed with the calls. I have tried to manually correct, but I think in a few cases I have missed some so be aware.
Monday - SNP. I've mentioned many times on here that I don't like/trust ADR/ADS because of their even worse overseas regulation. The exception would be a company like STO because of its location in Norway. Who doesn't trust Norwegians? At any rate, I am not going to make a comment either way here because I've seen screwy patterns and volume many times in the past.
Tuesday - I think APOL will be volatile, just not volatile enough. Same thing for GIGM. ACH is another Chinese ADR. LEN... a 40% move seems a bit much to ask of any stock in this environment.
Wednesday - nothing. Probably because no bank wants to have their earnings on April Fool's Day. It's just too easy to make jokes. I'm sure LOLFed is sad.
Thursday - Two big companies MON and RIMM. I'll take MON first. Current pricing has an average absolute move of 11.25 which is well within the performance of the last two quarters considering the moves of +19.22% and +18.38% respectively. However, it just moved up from the 80 level and just like the rest of the market has moved basically 25% in 2 weeks time. It's difficult to imagine how much room is left on the upside especially with the DMA(200) looming at 93.20. MON has not been above DMA(200) since October. My two cent gut feeling is a return to 80. Now for RIMM, which is up about 22% give or take in the same period of time. The way that the spreadsheet calculates its break-evens is on a gap in strikes but even buying both at 45 still is no guarantee of success. The downside B/E ends up at 37.90 which is virtually the trough before the latest run and to move up requires a big bounce above the DMA(50). It's certainly not impossible - RIMM has made moves like this in the past - but it seems more unlikely this time around with the indices appearing to hit a local maxima. Of the other two on this day, KMX has shot up about 40% and MDRX about 25%. It seems unlikely that either of these two will be profitable strangles.
Friday - nothing made it through the screen.
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