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Two Safe-Haven Plays from Market Fears

Two Safe-Haven Plays from Market Fears

1 2These companies should be able to hold their own and even thrive.The market has flipped from greed to fear as concerns over the coronavirus outbreak spreads. In the span of a week, stocks sold off over 10 percent. That’s only the sixth time since the financial crisis that a drop has been that steep. There could still be some downside, but a combination of solid growth plays and pre-coronavirus laggard companies could do well for investors here. That’s because, in time, fears will subside. Supply chains will be normalized. Things will return to normal, and the market will find some...
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Unusual Options Activity: Qualcomm (QCOM)

The April $75 calls onQualcomm (QCOM) saw a 17-fold rise in volume, going from 253 open contracts to having over 4,350 trade hands. The bet, expiring in 46 days, is already about $2.30 in the money given the recent share price of $77.30. The trader buying the shares paid about $5.90 per contract. For the option to profit at expiration, shares would need to be back over $81. Even with the recent market rout, shares of Qualcomm are still up about 50 percent in the past year.Action to take: Like most stocks right now, shares look oversold and due for a bounce higher. Over the longer-term...
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Unusual Options Activity: Micron (MU)

$35 call options with an April expiration onMicron Technology (MU) recently saw a 40-fold rise in volume. The option went from 101 open contracts to over 3,900. The bet, expiring in 49 days is unusual in that this trade made a deep in-the-money bet. With shares around $54, the option is about $19 in-the-money, and should move dollar-for-dollar with shares. The trader also paid about $19 to get into the trade, so there’s nearly no time premium. Semiconductor names have been hit hard in the past few trading sessions, as coronavirus fears have spread. Even with the steep drop, Micron has...
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Unusual Options Activity: The Walt Disney Company (DIS)

Unusual Options Activity: The Walt Disney Company (DIS)

Trader bets on bounce in shares next month. Over 1,050 contracts traded on the March $136 call options on The Walt Disney Company (DIS). This is an eight-fold rise from the prior open interest of 135 contracts. The option, expiring in 22 days, is a play on shares moving $5 higher from around $130 right now. That’s about a 5 percent jump. Shares have sold off heavily recently as coronavirus fears are likely to impact tourism and travel, in turn lowering revenues at the company’s theme parks. And the company recently announced a new CEO. Shares of Disney are up 17 percent in the past year,...
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Two Beaten-Down Blue Chips to Buy Now

Two Beaten-Down Blue Chips to Buy Now

1 2Traders should take advantage of market fears to buy these names on sale. We’re firm believers that investing is most successful when it’s most businesslike. One way to do that is to find companies that are attractively valued, and then buy them when they’re on sale. It’s a lot like buying groceries and taking advantage of the occasional offer that allows you to stretch your dollars further. Of course, in the real world, it’s tough. Our emotions come into play. But we need to set those aside and look at the facts. Market fears come and go, and the market may be more than halfway throug...
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Insider Activity Report: Sally Beauty Holdings (SBH)

Insider Activity Report: Sally Beauty Holdings (SBH)

President & CEO adds to stake.Christian Brickman, President and CEO at Sally Beauty Holdings (SBH), recently bought 7,650 shares. The buy cost just under $95,000, and increased his shares by 1.8 percent. This marks the second insider buy at the company this year, following a director buy of 9,000 shares earlier in the month. Insider activity at the company over the past three years shows large numbers of insider buys on a regular basis, as well as the occasional small insider sale. Shares of the beauty supply chain have dropped 30 percent in the past year, underperforming the market by...
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Unusual Options Activity: United Parcel Service (UPS)

Unusual Options Activity: United Parcel Service (UPS)

Trader bets on further decline on coronavirus pandemic.  With the global economy set to slow thanks to the coronavirus, traders are hedging their bets. One is betting that United Parcel Service (UPS) will continued to decline from here. That’s based on the 15-fold rise in volume on the April $97.50 put options. From 320 open contracts, over 4,900 recently traded hands. The bet expires in 51 days. It is less than one dollar out-of-the-money thanks to the current share price just over $98.30. Any further weakness in shares will move the option in-the-money. The trader paid about $3.60 fo...
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Insider Trading Reports: Bunge (BG)

Insider Trading Reports: Bunge (BG)

CEO and director add to insiders picking up shares here. Gregory Heckman, CEO at Bunge (BG) recently bought 37,180 shares. That buy increased his holdings by nearly 40 percent. The cost of the purchase came to just under $2 million. He was joined by director Erik Fyrwald, who bought 3,750 shares. His total buy came to just under $200,000, and he increased his holdings by nearly 55 percent. This comes on top of insider buying by the company CFO in the prior week. Shares of the agribusiness giant are now flat over the past year. Insiders have turned from modest sellers in 2017 to sizeable ...
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Insider Activity Report: Enterprise Products Partners (EPD)

Insider Activity Report: Enterprise Products Partners (EPD)

Major owner continues to add to stake.Randall Williams, a major holder and director at Enterprise Products Partners (EPD), continues to add to his stake. In February, he has bought in 50,000 share increments on 13 different trading days. That’s a total of 650,000 shares. Each daily buy of this nature costs just over $1.3 million. Insider data shows these buys are dwarfing all prior buys and sells in the past few years at the company. Considering the existing stake in shares, the buy may be because of a perceived weakness in shares, or in the expectation of an event like a buyout or acquisit...
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Unusual Options Activity: Gilead Sciences (GILD)

Unusual Options Activity: Gilead Sciences (GILD)

Trader bets on rally through April.April 3rd call options with a $70 strike on Gilead Sciences (GILD) recently saw an 18-fold rise in volume, going from 117 open contracts to over 2,100 trade hands. The bet, expiring in 38 days, is that shares will head higher. As shares are around $69.50, the bet is almost at-the-money, and could move dollar-for-dollar higher with shares. The buyer of the option paid about $2.71 per contract, so shares would need to get over $72.70 at expiration for the buyer to profit. Shares have traded as high as $71.19 in the past year, meaning the trader expects share...
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