in 1 (small) lot of Jan 16 $135 C @ $6.95 – ready to add, improve etc. if it goes lower; I will simply try to go slow / buy more only when price variations are large
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sold short May 22 $130 P @ $3.5 – against about a third of my cash, say that is a lot (much smaller than lots in other posts / trades)
You will excuse me that I will not try to guess revenue, EPS etc. with a spreadsheet this time. There are several reasons, I’m lazy, it’s not necessarily more accurate if you put up a spreadsheet and it may not matter that much. By that I mean that cash return program and the Watch will be at least as important. About the Watch, I think they will not give any numbers, but sales will be visible in the next quarter revenue and GM guidance.
About earnings for FQ2 (CQ1), numbers from usage data aggregators suggest to me about 61.5M iPhones sold. Some analysts think they will reduce channel inventory, I think it will be up or at least flat. Usage data is not homogenous with Q1, it’s not so much a novelty now, and sales are more skewed toward Asia, not sure how usage data is collected there. So I think iPhone will be in the 60M to 65M range, implying revenue around $60B (other revenue like iPad will be down too). They have guided GM a bit up so I’ll say 39-40%, which a quick estimate will give EPS of about $2.30 to $2.40, also depending of how many extra shares they have bought back.
I think the 3 good news (earnings, more cash return, very good guidance) have reasonable chance to unlock the stock from the $120-$130 range towards the upside. Of course, as they say, if you want to see if god(s) have a sense of humour, make a plan!
in May 15 $135 C @ $2.75 – call that one lot
this is mostly related to earnings, change in capital return policies etc. in April – I plan to increase the play if AAPL keeps going lower, especially if it does so very fast and I recover something from the remaining March puts
MaxPain – $118 – $242.34M, $120 – 246.88M (almost flat), $125 – $370.1M, $128 – $487.38M
There is some game to play, but Greece could make it go either way in a big way (which is good for very short term option jockeys (/ junkies?) like me)
Our second daughter, Clara Simona, was born this morning. Everybody’s fine
My adrenalin is calming down just now, making place for sweet and gentle happiness …
Max Pain $121 – $53.1M total options value as of yesterday’s close (lots of options C & P trades at $125-$127 strikes today), $125 – $76.8M, $126 – $91.1M
I might try another puts bet
I have a bad feeling about Greece. Not only it looks like the spending cap negotiations in the US which have spooked the markets, but a mix of history (greeks want money from Germany for WWII), incompatible politics, geo-strategic chess with Putin, rigid european rules (Europe is not even 10% as integrated as the US), bank runs in Greece and an air of Lehman Brothers (let them fail to teach the others a lesson).
Not to mention pride on both sides, I was talking to my wife yesterday and she said “I cannot believe there is a possibility that they do not find a compromise, it’s their job as politicians”. My answer was that (except Merkel), those are mostly guys who put pride, revenge and pissing / chicken games above the general interest. On top of that, if you follow the money, politicians are not there to solve problems, but to get and retain votes. If this means selling snake oil or killing your adversary (not physically, of course), so be it!
In short, if there is no crash today at open, I will start a relatively large play on puts on AAPL (the greatest and easiest sucker to manipulate if you want to change markets but also the amplifier chamber of genuine market moves). I will get in in several steps and several strikes / expiration dates.
I know they say they have built protection dams, reduced exposure, that this is already priced in and so on, but I believe in their dams as much as in those at Fukushima, after fact!