Cintas reported and beat on both top and bottom lines – shares tanked.
music selection: “When Legends Rise” — Godsmack
The markets can be non-sensical sometimes. CTAS should be rising today. My bull call spread became threatened at close yesterday with the upper strike out of the money. With this morning’s sell off, the spread was entirely out of the money. This could be a short term blip but it could also be that the thesis has changed. Shares are in fact richly valued. I decided to get out now and recover as much time value as possible rather than wait for a 50% decline and stop out.
I bought the 370/380 bull call spread with 20AUG2021 expiry on 6JUL2021 for 5.80 a share (8 spreads). I sold today for 4.10. I booked a loss of 1,530 on 5,220 capital at risk. That is a 29.3% short term loss over 10 days.
My projected profit and loss for June is currently a 10,520 gain. August is pacing at 4,325 with Facebook at breakeven. I’m going to hold there and see if the trend can’t continue. September is too early to call but all spreads are fully in the money and if expiry were today, I’d book 10,336 in profits.
Devour your prey raptors!