Shares of digital advertising firm The Trade Desk (TTD) have been trending higher in the past few weeks after a longer-term slump. One trader sees the shares continuing higher.
That’s based on the October 15 $75 calls. With 98 days until expiration, over 41,150 contracts traded, a 154-fold jump in volume from the prior open interest of 260. The buyer of the call paid about $10.25 to make the trade.
Shares last traded north of $77.50, putting the call options about $2.50 in-the-money already. Shares have traded as high as $97 in the past year, so on a return to that prior high, the option could be worth as much as $23 at expiration, providing a clear triple-digit profit.
- Man Who Predicted 2008 Crash: “The Mother of All Crashes is Coming”
If you've watched the movie The Big Short,you've heard of Michael Burry. He was one of the few who no only predicated the 2008 crash but profited from it.
He made $750 million for his investors and $100 million personally when his bet against the housing market paid off. His next big prediction?
He's warning the "mother of all crashes" is coming.
If you have any money in the markets, I urge you to click here and get the exact day of the next stock market crash.
The company has seen revenues rise nearly 37 percent in the past year, and shares sport a 27 percent profit margin. There’s room for improvement as digital advertising trends remain strong.
Action to take: Shares are certainly pricey at over 150 times forward earnings, so investors may want to sit this one out and play the current uptrend with a call option.
The October calls are well placed in terms of the strike date, and trading in-the-money allows for traders to take lower profits with a higher likelihood of the option expiring with some value on the trade. Those looking for a bigger risk could pay less to buy options with a higher strike price, and bet on a more definitive move higher in the coming weeks.
Disclosure: The author of this article has no position in the company mentioned here, but may make a trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.