ACTION:
Buy to open the MRVL May 18 calls (MRVL150515C00018000, $0.50, flat) at current levels.
Dear Momentum Options Subscriber,
I have a New Trade on a familiar name ahead of earnings. With this trade comes risk, but an earnings beat and raised guidance should get us a nice return on the call options I’m recommending.
Marvell Technology (MRVL, $16.26, down $0.08)
Buy to open the MRVL May 18 calls (MRVL150515C00018000, $0.50, flat) at current levels.
I like these call options at current levels. Earnings are due out tomorrow, Feb. 19, after the market closes, so there is added risk/reward to this trade. There are also rumors swirling that Lenovo is interested in acquiring the company.
I am using the May calls to reduce the risk of an earnings miss. The May calls have 86 days before they expire on May 15, which will give the trade more time to wait for a possible takeover offer. I will also have some interesting news about Marvell Technology in tomorrow’s update, and I’ll explain why I like the fundamentals of this trade and not just the upcoming earnings release.
All prices given in this update are current as of 2:30 p.m. EST.
Every new Momentum Options recommendation is listed with the price at which I entered my own position. If the price is slightly different than my recommended entry or exit price when you receive the alert, don’t let that keep you from getting into or out of a trade. Occasionally, you might even get a better “fill” price than what is posted in the Open Trades and Closed Trades.
Trade on!
Rick Rouse
Editor and Chief Options Strategist
Momentum Options