Medtronic plc (MDT)

Update 8/24/2017: MDT’s came in at $1.12 per share, slightly above analysts’ consensus estimate of $1.09. The stock price fell by $3+ over two days. (By the way, am I alone in thinking that such counter-intuitive declines show that earnings estimates have little predictive value to trading?)

Zacks Investment Research forecast a positive earnings surprise, with an Earnings Surprise Predictor score of 0.93.

Shares showed a net decline of 5.1% over my three-day holding period, or a -618% annual rate. The options position produced a -42.2% loss for a -5,137% annual rate.

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MDT publishes earnings on Tuesday before the opening bell.

I shall use options that trade for the last time 11 days hence, on Sept. 1.

Implied volatility stands at 18%, which is 1.3 times the VIX, a measure of the volatility of the S&P 500 index.

MDT’s IV stands in the 32nd percentile of its annual range and the 57th percentile of its most recent broad movement.

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Momo Inc. (MOMO)

Update 8/28/2017: MOMO met earnings expectations but even so, declined by $9 after publication. It moved in a slight uptrend for three days afterward, before falling another $3 and then on the next day $2 more. 

The best exit strategy would have been to get out quickly. The first day’s fall took it below the breakeven point, and there it remained for the lifespan of the position. Perhaps that’s a good rule of thumb: If a position moves beyond breakeven, perhaps adding a requirement that it open beyond the next day, then exit immediately.

The Earnings Surprise Predictor from Zacks Investment Research gave no indication of a likely surprise, and there was none, illustrating yet against that earnings results are a poor predictor of post-earnings price movements.

Shares fell by 20.2% over seven days, or a -1,055% annual rate. The options position produced a -46.9% loss for a -2,446% annual rate.

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MOMO publishes earnings on Tuesday before the opening bell.

I shall use options that trade for the last time 11 days hence, on Sept. 1.

Implied volatility stands at 61%, which is 4.3 times the VIX, a measure of the volatility of the S&P 500 index.

MOMO’s IV stands in the 23rd percentile of its annual range and the 58th percentile of its most recent broad movement.

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Coty Inc. (COTY)

Update 8/24/2017; COTY missed earnings expectations, coming in at $0.63 as opposed to the consensus $0.75. Shares fell $3+ and zig-zagged for two days. I exited on the third day for a loss.

Shares declined by 13.4% over three days, or a -1,631% annual rate. The options position produced a 46.8% loss for a -5,699% annual rate.

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COTY publishes earnings on Tuesday before the opening bell.

I shall use options that trade for the last time 11 days hence, on Sept. 1.

Implied volatility stands at 44%, which is 3.2 times the VIX, a measure of the volatility of the S&P 500 index.

COTY’s IV stands in the 88th percentile of its annual range and at the peak of its most recent broad movement.

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8/21 – 3:15 p.m. New York time

I entered three positions today– COTY, MDT and MOMO — and exited three —DE, CSCO and NTAP.

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Three major reports punctuate the trading week: Durable goods orders on Friday at 8:30 a.m. New York time, and earlier in the week, two real-estate reports: Existing home sales on Thursday and new home sales on Wednesday, each at 10 a.m.

But the spotlights and trumpets and drum rolls and other markers of drama will be focused on  Jackson Hole, Wyoming, where the annual Economic Policy Symposium hosted by the Kansas City Federal Reserve Bank open on Thursday at 8 p.m. (all times for the symposium are listed as New York time; the local time in Jackson Hole is two hours earlier).

Fed Chair Janet Yellen addresses the forum on Friday at 10 a.m. European Central Bank Chairman Mario Draghi will also speak to the symposium, also on Friday,  at 3 p.m.

The conference will continue through Saturday.

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8/18 – 3:40 p.m. New York time

No other trades beyond my exit of AMAT.

8/18 – 9:35 a.m. New York time

I have exited AMAT for a profit.

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Deere & Co. (DE)

Update 8/21/2017: DE hit its earnings mark almost perfectly, at $1.97 per share, but fell $12 in trading after the announcement, recovering about a third of the decline as trading progressed in the first post-earns session. I exited for a loss less than a week before the options expire.

Shares showed a net decline of 7.2% over my four-day holding period, or a -661% annual rate. The options position produced a -39.4% loss for a -3,598% annual rate.

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DE publishes earnings on Friday before the opening bell.

I shall use options that trade for the last time eight days hence, on Aug. 25.

Implied volatility stands at 27%, which is double the VIX, a measure of the volatility of the S&P 500 index.

DE’s IV stands in the 74th percentile of its annual range and the 68th percentile of its most recent broad movement.

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Applied Materials Inc. (AMAT)

Update 8/18/2017: AMAT’s earnings beat analysts expectations by 2 cents, at $0.86 per share. The stock price rose  b6 $2 pre-market trading. I exited at $1.75, or 17.5% of maximum potential profit, with the stock at $44.72.

Shares rose by a a net 2.2% during my one-day holding period, or a +792% annual rate. The options position produced a 21.1% return for a +7,717% annual rate

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AMAT publishes earnings on Thursday after the closing bell.

I shall use options that trade for the last time eight days hence, on Aug. 25.

Implied volatility stands at 37%, which is 2.8 times the VIX, a measure of the volatility of the S&P 500 index.

AMAT’s IV stands in the 86th percentile of its annual range and the 93rd percentile of its most recent broad movement.

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The Gap Inc. (GPS)

GPS publishes earnings on Thursday after the closing bell.

I shall use options that trade for the last time eight days hence, on Aug. 25.

Implied volatility stands at 41%, which is 3.1 times the VIX, a measure of the volatility of the S&P 500 index.

GPS’ IV stands in the 53rd percentile of its annual range and the 75th percentile of its most recent broad movement.

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8/17 – 3:30 p.m. New York time

I entered positions on AMAT and DE coinciding with earnings announcements, and exited a position on WMT.

I analyzed GPS but declined the trade.

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