I have three new trades today.
music selection: “Kodo (Hishou Version) — Yoshida Brothers
weigh-in: 208.2 (1.0)
First up is a return to the theme of Big Cheap Tech. I’m going back to Oracle (ORCL) for its healthy cash and reasonable pricing. If I get assigned and can’t exit gracefully for a long period, I should still do well as this is a company that rewards shareholders. I sold ORCL180119P00050000 for 1.43 a share. The trade will be in force for 40 days and yields a projected 26.10% annualized while enjoying 3.29% downside protection.
Next up is a much smaller tech company but one with great prospects and even better cash flow: ON Semiconductor Corporation (ON). ON provides electronics components to consumer goods manufacturers such as car companies. It has stable growth to go along with its strong cash performance. I sold ON180119P00019000 for 50 cents a share. The trade will be in force for 40 days and yields a projected 24.97% while enjoying 4.88% downside protection.
Finally, I’m going back to Target (TGT) for its strong balance sheet, stable sales, and outstanding cash flow. The retail sector has taken a beating over the last year. We’ve reached the point where Wikipedia has a page for “retail apocalypse”. To me, this signals shorting retail is no longer a contrarian trade. The retail hate has gone mainstream so the sector should be poised for a short term rally. I sold TGT180126P00062000 for 2.50 a share. The trade will be in force for 47 days and yields a projected 31.31% annualized while enjoying 4.20% downside protection.
The three trades average a projected annualized return of 27.46% while generating 1,046 in cash income for the month of January. Three more positions due to be rolled after expiring this Friday should add another 1,000 or so to the January total. 2018 looks to be a strong year at the raptor.
Devour your prey raptors!