January 2011 | Members

Please remember, ALL “Exit Targets” and “Stop Targets” are targets.  You should not have any “Hard Stops” entered to close any trades or “Exit Orders” in your brokerage account unless we list one.  We will send out an “Alert” or “Trade Update” if we want you to close a position OR if a new trade comes out.  Otherwise, follow instructions at all times in the 9am and 1pm updates.  Also, we will usually give you a heads-up if we think we are going to send an email outside of these time frames but it is rare that we do.

1:05pm (EST)

Apollo Group (APOL, $40.22, up $4.28)

February 34 puts (APOL110219P00035000, $0.40, down $1.10)

Entry Price:  $0.85 (1/7/11)

Exit Target: $1.70 (closed half @ $1.70 on 1/10/11)   

Return: 24%

Stop Target: None

Action:  There should be a lid at $40 on the stock and after today and we expect shares to drift lower over the next month or so.  We have plenty of time to wait as these options do not expire for another 38 days.

We closed half at $1.70 and the current 40 cents on the other half gives an average price of $1.05.


Louisiana-Pacific (LPX, $9.93, down $0.20)

May 11 calls (LPX110521C00011000, $0.75, down $0.10)

Entry Price:  $0.70 (1/5/11)

Exit Target: $1.40

Return: 7%

Stop Target: None

Action:  We are looking for the stock to test its 52-week high of $13.44 over the next 5 months.  This would make the calls worth $2.50 if our price target of $13.50 is hit.  The company reports earnings on February 11 and these options have 129 days before they expire.  Continue to hold.

 

Brocade Communications (BRCD, $5.78, up $0.04)

July 6 calls (BRCD110716C00006000, $0.75, up $0.01)

Entry Price:  $0.67 (1/4/11)

Exit Target: $1.35

Return: 12%

Stop Target: None

Action:  These options have 185 days before expiration and we think shares will be at $8 come summertime.  This would get the call options to $2.  The company reports earnings on February 21.  Continue to hold.   


Micron Technology (MU, $8.65, up $0.10)

April 9 calls (MU110416C00009000, $0.65, up $0.05)

Entry Price:  $0.50 (1/3/11)

Exit Target: $1.00

Return: 30%

Stop Target: None

Action:  We have a $10 price target on shares over the near-term which gets these options to a least $1.  Continue to hold.


Riverbed Technology (RVBD, $39.00, up $0.73)

March 40 calls (RVBD110319C00040000, $3.40, up $0.40)

Entry Price:  $1.70 (12/29/10)

Exit Target: $3.40 (closed half @ $3.00 on 1/7/11)   

Return: 88%

Stop Target: $1.90 

Action:  Shares are pushing $40.  We are expecting Riverbed to break $40 and push $45 over the next few months if momentum stays strong.  The company reports earnings on January 27.  Continue to hold.  


Skyworks Solutions (SWKS, $31.50, down $0.20)

May 32 calls (SWKS110521C00032000, $2.90, down $0.10) 

Entry Price:  $1.70 (12/29/10)

Exit Target: $3.40

Return: 71%

Stop Target: $1.75 

Action:  The company is set to present at the Needham Growth Conference on Thursday.  We think Skyworks is headed to $35, possibly $40 over the next 5 months.  The May options have 129 days before they expire. The company reports earnings on January 19, or next Wednesday.  Continue to hold.

 

JDS Uniphase (JDSU, $16.49, up $0.02)

March 15 calls (JDSU110319C00015000, $2.00, flat)

Entry Price:  $0.78 (12/27/10)

Exit Target: $1.60 (closed half @ $1.80 on 1/7/11)

Return: 144%

Stop Target: None

Action:  Continue to hold the other half.  We think JDSU is headed to $20 over the near-term.


Seattle Genetics (SGEN, $16.62, up $0.80)

March 17.50 calls (SGEN110319C00017500, $1.25, up $0.40)

Entry Price:  $0.70 (12/27/10)

Exit Target: $1.40

Return: 79%

Stop Target: None

Action:  Looking good.  Continue to hold.


THQ (THQI, $6.30, up $0.12) 

June 6 calls (THQI110618C00006000, $1.20, flat)

Entry Price:  $0.75 (12/8/10)

Exit Target: $2.00

Return: 60%

Stop Target: 50 cents

Action:  The June calls have 157 days before expiration.  Continue to hold.    


Electronic Arts (ERTS, $15.95, down $0.06)

March 20 calls (ERTS110319C00020000, $0.14, flat) 

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: -36%

Stop Target: None

Action:  Continue to hold.  


Other 2010 Portfolio OPEN positions (3):  These are trades that are still open in the portfolio that have longer expiration dates or are on “hold” but are not worth mentioning until they turn around.  We are still keeping track of the trade and we will record the results, accordingly, when we close them or the options expire.  Click on the 2010 Portfolio link in the Members Area to view ALL open/ closed trades.

Biodel March 7.50 calls (from October)

American Tower April 60 calls (from October)

Constellation Brands February 22.50 calls (from January) 


WATCH LIST SECTION

These trades are NOT recommendations until we send out an alert.  These are trades that we like but have not added to the portfolio as an official recommendation because of market conditions or because we are waiting for better entry prices.  We will not list entry prices because these stocks are on the verge of breaking out or they could sell-off.


We will update this section in the morning.

============================

10:25pm (EST)

We just wanted to give everyone an update on SGEN.  The company’s CEO is speaking today at 11:30am (EST) on CNBC and he could be saying some good things.  Here is the current trade as we head to press:

Seattle Genetics (SGEN, $15.96, up $0.14)

March 17.50 calls (SGEN110319C00017500, $0.85, flat)

Entry Price:  $0.70 (12/27/10)

Exit Target: $1.40

Return: 21%

Stop Target: None

Action:  We aren’t sure how much of a pop shares could get but we think the stock trades to over $16 and could run to $17 if the CEO says some good things about the company’s cancer drug.  This is just a heads-up before our 1pm update.

============================

9:00am (EST)

Apollo Group (APOL, $35.94, down $2.04)

February 34 puts (APOL110219P00035000, $1.50, up $0.55)

Entry Price:  $0.85 (1/7/11)

Exit Target: $1.70 (closed half @ $1.70 on 1/10/11)   

Return: 88%

Stop Target: None

Action:  We closed half the trade yesterday because we knew there was a chance shares could bounce back and they did in after-hours last night.  Apollo was pushing $40 (a 10% pop) but closed near $38.    

We said we doubted Apollo would report “blowout earnings” but they cut cost to come in with better-than-expected numbers.  This won’t last as they also said new enrollment is down over 40%.    

We made it a risk-free trade by closing half and we said Apollo could move 10% after the announcement.  Shares did on the move up to $40 and faded, and we don’t expect the gains to hold which is another reason we went with the February options.  Even if the other half of the trade expires worthless, we still breakeven so we have plenty of time to wait.    


Louisiana-Pacific (LPX, $10.13, up $0.06)

May 11 calls (LPX110521C00011000, $0.85, up $0.05)

Entry Price:  $0.70 (1/5/11)

Exit Target: $1.40

Return: 21%

Stop Target: None

Action:  We are looking for the stock to test its 52-week high of $13.44 over the next 5 months.  This would make the calls worth $2.50 if our price target of $13.50 is hit.  The company reports earnings on February 11 and these options have 129 days before they expire.  Continue to hold.

 

Brocade Communications (BRCD, $5.74, up $0.03)

July 6 calls (BRCD110716C00006000, $0.74, up $0.01)

Entry Price:  $0.67 (1/4/11)

Exit Target: $1.35

Return: 10%

Stop Target: None

Action:  These options have 185 days before expiration and we think shares will be at $8 come summertime.  This would get the call options to $2.  The company reports earnings on February 21.  Continue to hold.   

   

Micron Technology (MU, $8.55, down $0.10)

April 9 calls (MU110416C00009000, $0.60, down $0.07)

Entry Price:  $0.50 (1/3/11)

Exit Target: $1.00

Return: 20%

Stop Target: None

Action:  We have a $10 price target on shares over the near-term which gets these options to a least $1.  Continue to hold.


Riverbed Technology (RVBD, $38.27, down $0.08)

March 40 calls (RVBD110319C00040000, $3.00, flat)

Entry Price:  $1.70 (12/29/10)

Exit Target: $3.40 (closed half @ $3.00 on 1/7/11)   

Return: 76%

Stop Target: $1.90 

Action:  We are expecting Riverbed to break $40 and push $45 over the next few months if momentum stays strong.  The company reports earnings on January 27.  Continue to hold.  


Skyworks Solutions (SWKS, $31.70, up $1.46)

May 32 calls (SWKS110521C00032000, $3.00, up $0.75) 

Entry Price:  $1.70 (12/29/10)

Exit Target: $3.40

Return: 76%

Stop Target: $1.25, raise to $1.75 

Action:  Shares surged nearly 5% yesterday and there will news out on Thursday as the company is set to present at the Needham Growth Conference.  We think Skyworks is headed to $35, possibly $40 over the next 5 months.  The May options have 129 days before they expire. The company reports earnings on January 19, or next Wednesday. 

The January options expire 2 days after the company announces earnings so we doubt we do an “add-on” on trade with them but we may add some February calls if shares stay strong.  We will do some more research but we are watching the February 35 calls which closed at 65 cents yesterday.  Continue to hold.


JDS Uniphase (JDSU, $16.47, up $0.23)

March 15 calls (JDSU110319C00015000, $2.00, up $0.15)

Entry Price:  $0.78 (12/27/10)

Exit Target: $1.60 (closed half @ $1.80 on 1/7/11)

Return: 144%

Stop Target: None

Action:  Continue to hold the other half.  We think JDSU is headed to $20 over the near-term.


Seattle Genetics (SGEN, $15.82, up $0.23)

March 17.50 calls (SGEN110319C00017500, $0.85, flat)

Entry Price:  $0.70 (12/27/10)

Exit Target: $1.40

Return: 21%

Stop Target: None

Action:  Continue to hold.


Jabil Circuit (JBL, $20.90, down $0.17)

March 19 calls (JBL110319C00019000, $2.50, down $0.20)

Entry Price:  $0.70 (12/14/10)

Exit Target: $1.50+ (closed half @ $1.70 on 12/21/10)

Return: 182%

Stop Target:  $2.25 (HARD STOP)

Action:  We were stopped out of the other half of this trade yesterday as the options traded to a low of $2.20.  Although the options came back a little, we will have to wait for another entry point.  The March 22.50’s are at 80 cents so we may target them on a continued move higher.


THQ (THQI, $6.18, down $0.12) 

June 6 calls (THQI110618C00006000, $1.20, flat)

Entry Price:  $0.75 (12/8/10)

Exit Target: $2.00

Return: 60%

Stop Target: 50 cents

Action:  The June calls have 157 days before expiration.  Continue to hold.    


Electronic Arts (ERTS, $16.01, down $0.04)

March 20 calls (ERTS110319C00020000, $0.14, flat) 

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: -36%

Stop Target: None

Action:  Continue to hold.  


Other 2010 Portfolio OPEN positions (3):  These are trades that are still open in the portfolio that have longer expiration dates or are on “hold” but are not worth mentioning until they turn around.  We are still keeping track of the trade and we will record the results, accordingly, when we close them or the options expire.  Click on the 2010 Portfolio link in the Members Area to view ALL open/ closed trades.

Biodel March 7.50 calls (from October)

American Tower April 60 calls (from October)

Constellation Brands February 22.50 calls (from January) 


WATCH LIST SECTION

These trades are NOT recommendations until we send out an alert.  These are trades that we like but have not added to the portfolio as an official recommendation because of market conditions or because we are waiting for better entry prices.  We will not list entry prices because these stocks are on the verge of breaking out or they could sell-off.


Pfizer (PFE, $18.26, down $0.08)  

March 18 calls (PFE11031900018000, $0.73, down $0.05)

Thoughts:  Watch for now.


TiVo (TIVO, $9.93, down $0.05)

May 17.50 calls (TIVO110521C00017500, $0.60, flat) 

Thoughts:  Watch for now.


Imax (IMAX, $27.09, down $0.12)

June 35 calls (IMAX110618C00035000, $0.90, down $0.05)

Thoughts:  These options look so, so tempting…  


Green Mountain Coffee Roasters (GMCR, $35.85, down $0.07)

February 40 calls (GMCR110219C00040000, $0.90, flat)

Thoughts:  There is a lot of takeover buzz surrounding this name.  Continue to watch. 


Best Buy (BBY, $35.91,up $0.54) 

March 40 calls (BBY110319C00040000, $0.45, up $0.05)

Thoughts:  We are warming up to these calls but we are also watching the March 38 calls which are at 90 cents.


CurrencyShares Euro Trust (FXE, $129.04, up $0.45)

February 125 puts (FXE110219P00125000, $0.95, down $0.15)

Thoughts:  We still think this ETF will fall to $125, quickly, and we have already missed some sweet profits in the 130’s.  Watch for now but we may take action soon.


Bank of America (BAC, $14.40, up $0.15)

February 14 calls (BAC110219C00014000, $0.85, up $0.05) 

Thoughts:  If shares continue to hold $14, it will be time to go long.  We are still doing some chart work.  Continue to watch.


Darden Restaurants (DRI, $46.26, down $0.25)

April 50 calls (DRI110416C00050000, $1.00, down $0.15)

Thoughts:  They may still be a trade here but not until shares reclaim $47-$48.