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Top Trades for Fri, 24 Sep 2021 13:34 – RWLK

Bonds getting crushed (rates moving higher):

  

I'm starting to like ReWalk (RWLK) and they are only at $100M with $75M on the balance sheet and no debt so I think they are a very fun penny stock ($2.42) to put into the Future Is Now Portfolio.  

This is great stuff and they have enough patents where I don't think they'll be buried by competition - more likely bought out by MDT or someone.  They've been held down by a court case in Germany (their biggest market) deciding whether or not the suit should be covered by insurance - that case should go in their favor.  Also, Sarcos (muscle augmentation suits) is going public via SPAC with ROT and that's going to be around $2Bn so it should be the catalyst RWLK needs to get back to $4.  As to the court case:

This case was advanced by one of the larger insurers in Germany. . . ruling as a direct compensation basically would eliminate any of the other challenges to the use of this product. Direct compensation is meaning does a ReWalk or an exoskeleton in general provide an ability to walk that you cannot otherwise get. If it were considered indirect compensation, it would suggest you could go back to a wheelchair. 

RWLK does not have long-term options but it's cheap and it does have options so let's buy 10,000 shares at $2.44 ($24,400) and sell 75 of the Jan $2.50 calls at $1 ($7,500) so we have some room to run and let's sell 50 Jan $2.50 puts for $1 ($5,000) so we get 5,000 more shares at net $1.50.  That puts us in 10,000 shares for net $11,900 ($1.19/share) and if mostly called away at $2.50, that's $25,000 so up $13,100 (and more) is a 110% gain in 119 days - not bad for the upside. 

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