SNDK: We Need a Little More
Good Start, But Not Enough Yet
Dear Bottarelli Research Member,
As we expected, shares of SanDisk (SNDK – NASDAQ) are opening to the downside.
Although the U.S. flash memory maker posted better-than-expected results, shares are opening lower after SNDK forecasted revenues between $875 to $950 million and total 2010 revenues between $4 billion to $4.4 billion. Since this outlook was in line with Wall Street’s targets, investors are now struggling to rationalize the stock’s recent 100% gain. As a result, SNDK is dipping in early trading, but we still need more downside to make our earnings basket a winner. As you know, we entered the SNDK February 31 Calls (SWF BF) and SNDK February 28 Puts (SWF NB) for a total of $2.55. As of today, this basket is now trading for a total of $2.00. Let’s maintain both plays and see if one further downside push can put us in the black. Hold.
In other news, we’re finally starting to see an up-tick from Intercontinental Exchange (ICE – NYSE).If $95 proves to be a nice support level, shares should be back over $100 in no time. That’s why I’ve remained stubborn on my desire to hold our ICE February 105 Calls (ICE BA). The stock has too many upside triggers to let some floor traders shake us out of these calls. Hold.
And in many respects, the same goes for our MOS February 60 Calls (MOS BL). If the $55 level can hold, we’ll be back in business on this play as well. If you’re still holding the MOS calls, we should get a bounce soon. And finally, remain protected for any further downside using your DXD March 30 Calls (DOF CD).
Going into next week, my staff and I are still doing our due diligence on the next round of earnings possibilities. As I noted yesterday, the candidates are CYOU, ALF, CTRP, and CMI. As always, I’ll follow up later in the session with any new trading guidance.
Until then…
Lock and load!
Sincerely,
© 2012 CSR Group, LLC. All rights reserved. Published in USA.
Information, opinion, research, and commentary contained herein is obtained from sources believed to be reliable; their reliability, however, cannot be guaranteed. The maxim of Caveat Emptor applies — let the buyer beware. Bottarelli Research does not provide individual investment advice, act as an investment advisor, or individually advocate the purchase or sale of any security or investment.
Investments recommended in this service should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Bottarelli Research reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscriber’s initials will be used unless express written permission has been granted to the contrary.
CSR Group, LLC expressly forbids its writers from having a financial interest in any security recommended to readers. Furthermore, all employees and agents of CSR Group, LLC and its affiliate companies must wait 24 hours before following a published recommendation.