Oil came down hard.
Don't blame the Dollar:
Blame the global outlook on demand:
BBBY/Wilsons, Atty - Nice job on the patience play.
Top Trades for Thu, 16 Apr 2020 15:15 – BBBY
- Baird checks in on Bed Bath & Beyond (BBBY +17.2%) after the retailer's earnings reporte.
- "While we believe BBBY has enough liquidity to survive this downturn, the unprecedented demand shock adds another layer of complexity to what is already a difficult turnaround process,' reads the firm's update.
- Q2 and Q3 are seen dropping 5% to 20% from last year's levels.
- Barid keeps a Neutral rating in place and lowers its price target to $5 from $10 to reflect reduced EPS estimates.
- Previously: Bed Bath & Beyond +13% after slight sales beat (April 15)
Very tempting down here! I think, for the LTP, we may as well pick up the 50 of the BBBY 2022 $3 ($3.55)/10 ($1.45) bull call spreads at $2.05 ($10,250) and sell 20 of the 2022 $5 puts for $2.62 ($5,240) for a net $5,010 entry on the $35,000 spread so $29,990 (598%) upside potential if BBBY can get back to $10 in 20 months.
Sadly, I forgot to enter it.
Good little company with a nice dividend. I like it! We already have ET in the Dividend Portfolio but I think there's room for EPD and their $1.78 dividend so let's go for the following:
- Buy 1,000 shares EPD at $15.92 ($15,920)
- Sell 10 EPD 2023 $13 puts for $2.85 ($2,850)
- Sell 10 EPD 2023 $15 calls for $3 ($3,000)
That's net $10,070 on the $15,000 spread so about 50% upside and the $1.78 dividend is 17.67% while you wait! Worst case is we get to own 2,000 shares at an average of $11.53, which is a 27.5% discount to the current price.
