DAL Analysis

Delta Air Lines Inc. (DAL)

Update 4/27/2017DAL did a fair imitation of a yo-yo after earnings were published, rising sharply from where it began the today and then falling to near its starting point, falling further the next day and then rising to slightly beyond the post-earnings peak, and then declined again to near where the fluctuations began.

All in all, a lot of Sturm und Drang, signifying nothing. I exited at 33% of maximum potential profit.

Shares staged a net decline of 0.8% over 16 days, or a +18% annual rate. The options position produced a 49.1% yield on debit for a +1,121% annual rate.


DAL publishes earnings on Wednesday before the opening bell.

I shall use the MAY series of options, which trades for the last time 38 days hence, on May 19.

Implied volatility stands at 32%, which is 2.1 times the VIX, a measure of the volatility of the S&P 500 index.

DAL’s IV stands in the 27th percentile of its annual range and the 96th percentile of its most recent broad movement, which is in a fairly narrow range typical of DAL for the past two months.

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The Week Ahead: Employment, income, outlays, manufacturing, trade

 

In a reversal of T.S. Eliot, next week will begin with a whimper — the U.S. markets are closed on Monday for the Memorial Day holiday — and will end with a bang — the always much anticipated employment situation report, on Friday at 8:30 a.m. New York time.

The employment report will be previewed on Thursday  by the private-sector ADP employment report, out at 8:15 a.m.

Three other major reports  will be published during the week: Personal income and outlays on Monday at 8:30 a.m., the Institute of Supply Management manufacturing index on Thursday at 10 a.m. and international trade on Friday at 8:30 a.m.

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The Week Ahead: GDP, durables

The gross domestic product statistics providing a second estimate for the 1st quarter will be published on Friday at 8:30 a.m. New York time. Durable goods orders will be released concurrently.

Two real estate reports will punctuate the week: New home sales on Tuesday and the far larger existing home sales on Wednesday, each at 10 a.m.

Also out: the Purchasing Managers Institute composite flash report on Wednesday at 9:45 a.m., Federal Open Market Committee minutes from the May 2-3 meeting on Wednesday at 2 p.m. and international trade in goods on Thursday at 8:30 a.m.

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The Week Ahead: GDP, income and outlays, trade

 

A third and final estimate of 4th quarter gross domestic product will be published on Thursday. Other major reports: International trade in goods on Tuesday and personal income and outlays on Friday.

All three reports will be released at 8:30 a.m. New York time.

Federal Reserve Chair Janet Yellen addresses the National Community Reinvestment Coalition’s annual conference in Washington, D.C. on Tuesday at 12:50 p.m. Her topic: Addressing Workforce Development Challenges in Low-Income Communities.

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The Week Ahead: Durables, houses

 

Big ticket purchases and the housing sales will punctuate the trading week

Durable goods orders covers purchases with a useful life of three years or more. The statistics will be published on Friday at 8:30 a.m. New York time.

The housing sales data comes in two installments: Existing homes sales, the greater part of the market, on Wednesday and new home sales on Thursday, each at 10 a.m.

Also out during the week, the Purchasing Managers Institute composite flash report on Friday at 9:45 a.m.

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