Rocket Equities & Options Report - August 13, 2020
LYFT Trades Lower on Earnings
LYFT announced their earnings last night and it looks as if our credit spread is working out nicely as of now.
We'll keep our eye on Lyft throughout today, but I do not expect the stock to trade 10% higher by the close tomorrow, so we'll probably just look to let both our options expire worthless for our max profit.
We got into our credit spread yesterday for about $26 per contract, with about $74 of risk (risking about $3 to make $1). Our max profit was the $26 credit we received per contract upon initiation.
LYFT earnings highlights:
We'll keep our eye on Lyft throughout today, but I do not expect the stock to trade 10% higher by the close tomorrow, so we'll probably just look to let both our options expire worthless for our max profit.
We got into our credit spread yesterday for about $26 per contract, with about $74 of risk (risking about $3 to make $1). Our max profit was the $26 credit we received per contract upon initiation.
LYFT earnings highlights:
- Loss per share: 86 cents, adjusted vs. an expected 99 cents, adjusted
- Revenue: $339 million, vs. $337 million expected
- Active Riders: 8.7 million
- Revenue per active rider: $39.06
Uber
Uber has traded slightly lower this week after accelerating into earnings. Uber and Lyft are both facing resistance as they lost a case in California that means that may have to classify their drivers as employees vs. contractors. Uber and Lyft plan to appeal the decision.
Uber's CEO stated yesterday that if the ruling stands, they will need to pull out of Calirfornia at least for a few months as they would need to reorgnaize their business.
Uber's CEO stated yesterday that if the ruling stands, they will need to pull out of Calirfornia at least for a few months as they would need to reorgnaize their business.
Constellation trading nicely this week
STZ has traded to higher price this week and we will look for it to make it back within its uptrend channel.
Disney
Disney has resolved a dispute with their Walt Disney World employees over testing, agreeing to provide a virus-testing area outside of the park that will be run by the Florida Division of Emergency Management. The actors, who cannot wear masks while performing, had argues the company's proposed safeguards were inadequate.
Disney is also facing some headwinds with their ESPN franchise, as it looks like college football is having a hard time figuring out how they can have any type of a season, which would impact those ad sales in an obviously negative way.
Disney is also facing some headwinds with their ESPN franchise, as it looks like college football is having a hard time figuring out how they can have any type of a season, which would impact those ad sales in an obviously negative way.
Stay tuned for updates!
Long Term portfolio:
Long half a position in DIS at $118.63. Stop is $98.45.
Long half position in UBER at $31.50 or better. Stop is $26.24.
Long half position in STZ at $180.50. Stop is $164.05.
Short Term portfolio:
LYFT net credit spread $33/$34 that expires tomorrow afternoon for a $26 credit per contract pair. We will look to let this expire for maximum profit tomorrow as long as LYFT does not approach $33.
Long Term portfolio:
Long half a position in DIS at $118.63. Stop is $98.45.
Long half position in UBER at $31.50 or better. Stop is $26.24.
Long half position in STZ at $180.50. Stop is $164.05.
Short Term portfolio:
LYFT net credit spread $33/$34 that expires tomorrow afternoon for a $26 credit per contract pair. We will look to let this expire for maximum profit tomorrow as long as LYFT does not approach $33.