Shares: FIVE

Shares trade in connection with an earnings announcement for action on November 30: FIVE

The company came in short of the Street estimate by more than a cent. The price rose overnight, I exited immediately after the opening bell, and then the price fell.

sym entry exit result ($) result (%) entry date exit date
FIVE 61.95 62.67 0.72 1.2% 11/30 12/1
zacks rank zacks esp earns est. earns actual
2 5.56 0.13 0.1178

By Tim Bovee, Portland, Oregon, November 30, 2017

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Live: Thursday, November 30, 2017

11/30 – 3:40 p.m. New York time

I entered a new shares position on FIVE. I exited options positions on KR and ADSK and shares positions on MIK, DSGX and PSTG.

This brings the site up to date after a problem at the site’s host, WordPress, left me unable to post or edit for two solid hours. This didn’t impact my trading, but the documentation of positions that I closed will take some time to complete, and may well slip into Friday, a day in which I anticipate entering no new positions.

Long story short: For options, KR and MIK produced profits and ADSK, DSGX and PSTG, losses.

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Shares: DSGX and MIK

Shares trade in connection with an earnings announcement for action on November 29: DSGX and MIK.

DSGX came in 20% below the consensus estimate and the price fell. MIK came in slightly above estimate — essentially the same — and the price rose sharply.

sym entry exit result ($) result (%) entry date exit date
DSGX 30.05 27.85 -2.20 -7.3% 11/29 11/30
zacks rank zacks esp earns est. earns actual
3 10.00 0.1 0.08
sym entry exit result ($) result (%) entry date exit date
MIK 19.33 21.32 1.99 10.3% 11/29 11/30
zacks rank zacks esp earns est. earns actual
2 1.18 0.43 0.4357

By Tim Bovee, Portland, Oregon, November 29, 2017

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KR Analysis

The Kroger Co. (KR)

Update 11/30/2017: KR announced earnings of $0.4139 per share, beating analysts’ consensus expectation of $0.40. Share prices rose by $3.29 in early trading before the opening bell and then at the open went into a decline that lasted the day. I exited early, near the peak., at 86.1% of maximum potential return.

Shares rose by 11.8% during the one-day lifespan of the position, or a +4,301% annual rate. The options position produced a +620.0% return (not a typo) for a +226,300 annual rate (also not a typo).

From the pre-earns close to the close of the first post-earns session, the price rose by $1.48, well within the post-earns moves of the last four quarters.

Eleven analyst forecasts had implied a positive earnings surprise, with a Zacks earnings surprise predictor score of 3.33 in the context of a neutral longer-range rank of 3.

The trend metrics were mildly bullish, with an average directional index (ADX) of 25.88, a +DI of 32.38 and a -DI of 12.43.


KR publishes earnings on Thursday before the opening bell.

I shall use options that trade for the last time 16 days hence, on Dec. 15.

Implied volatility stands at 41%, which is 3.8 times the VIX, a measure of the volatility of the S&P 500 index.

KR’s IV stands in the 75th percentile of its annual range and the 92nd percentile of its most recent broad movement.

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Shares: GLNG, PSTG

Corrected from an earlier version posted 11/29.

Shares trade in connection with an earnings announcement for action on November 28: GLNG and PSTG.

GLNG the earnings publication date changed from what was expected and I exited for a small profit. Earnings were published after I exited, coming in slightly worse than the estimate, and the stock began a downtrend.

PSTG came in better than the Street estimate, although it was still a loss, and the price began a decline.

sym entry exit result ($) result (%) entry date exit date
GLNG 25.01 25.16 0.15 0.6% 11/28 11/29
zacks rank zacks esp earns est. earns actual
4 7.97 -0.36 -0.3673
sym entry exit result ($) result (%) entry date exit date
PSTG 18.90 17.93 -0.97 -5.1% 11/28 11/30
zacks rank zacks esp earns est. earns actual
3 18.52 -0.03 -0.0276

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MRVL Analysis

Marvell Technology Group Ltd. (MRVL)

MRVL publishes earnings on Tuesday after the closing bell.

I shall use options that trade for the last time 10 days hence, on Dec. 8.

Implied volatility stands at 38%, which is 3.8 times the VIX, a measure of the volatility of the S&P 500 index.

MRVL’s IV stands in the 71st percentile of its annual range and the 81st percentile of its most recent broad movement.

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ADSK Analysis

Autodesk Inc. (ADSK)

Update 11/30/2017: ADSK published earnings of a $0.12 per share loss, well below the Street estimate of a $0.1003 loss. In after hours trading share prices immediate drop $20 in 5 minutes. I exited for a loss.

Shares declined by 13.7% over the two-day existence of the position, or a -2,504% annual rate. The options position produced a -72.2% loss for a -13,181% annual rate.

The 12 analysts watching ADSK had anticipated a positive earnings surprise, issuing assessments implying an earnings surprise predictor score of 4.23 in the context of a neutral (3) longer-term expectation.

The $20.61 movement from the pre-earnings close to the end of the first post-earns session was larger than any among the prior four quarterly announcements.

The trend metrics showed ADSK as uptrending, with an ADSK of 30.79 with a +DI of 26.75 and a -DI of 15.00.

All in all, ADSK defied all metrics and every expectation.


ADSK publishes earnings on Tuesday after the closing bell.

I shall use options that trade for the last time 17 days hence, on Dec. 15.

Implied volatility stands at 40%, which is 3.9 times the VIX, a measure of the volatility of the S&P 500 index.

ADSK’s IV stands in the 64th percentile of its annual range and the 84th percentile of its most recent broad movement.

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How I analyze trades

Most of my trades coincide with publication of earnings, “earnings plays”, in the jargon of traders. I do so because those quarterly announcements are the only time I can guarantee heightened interest in stocks and their options, and therefore a likelihood that something will happen to provide me with an opportunity for profit. There is nothing worse than entering a position and seeing it immediately drift into the doldrums, where time passes and nothing happens.

Over years of trading I have settled on a few vehicles that best serve my needs.

When trading options, I use the short iron fly when I don’t know which way the price will move, or sometimes an iron condor if the options grid makes for a more balanced structure. When I expect the stock price to move in a direction, up or down, I use a short vertical position, a bull put spread for a rising price or a bear call spread for a falling one.

In analyzing potential positions I’m attempting to answer several questions.

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