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SPDR Dow Jones Industrial Average ETF Message Board

who_is_your_pappy 2 posts  |  Last Activity: Feb 12, 2016 12:37 PM Member since: Sep 28, 2004
  • who_is_your_pappy who_is_your_pappy Feb 12, 2016 12:37 PM Flag

    January 10 put is a nice write. Write 10 contracts for a premium of close to $4000.
    P up 25% (@10): +$4000
    P@8: +$2000
    P@6: break even
    P drops 50% (@4): -$2000
    P bankrupt this year: -$6000

    Risk reward is hard to beat for a fairly conservative company with savvy management and backers with a good track record.

    Sentiment: Hold

  • who_is_your_pappy by who_is_your_pappy Feb 12, 2016 11:14 AM Flag

    What a bloodbath for us P stockholders. I'm hanging on beyond when I know it's in my best interest. On the bright side, I bought early, so I haven't lost much.

    The reason bankruptcy wouldn't shock me: I can't remember the last time I read a story about a company hiring a bank to explore a sale when the outcome was positive. Sometimes you get an inexplicable pop in the stock for about a day, but it never lasts.

    The reason I am holding anyway: unlike most times when you read about a company putting itself on the auction block, this is a company that is still growing revenues, has a unique product with extremely loyal users, and could have suitors who would dramatically expand the user base and be able to monetize users more successfully. Most importantly, and overlooked by shorts, the potential suitors have gobs of money overseas with few overseas investment prospects. Pandora is a company that can provide domestic tax benefits and, eventually, domestic profits, while offering big opportunities for international investment.

    If they get even half way to their 2020 profit goal with the help of a good acquirer, it is accretive for almost any company at $10-$15 a share. And potential benefits to other acquirer businesses are significant, as are patents.

    Sentiment: Hold

DIA
176.32+0.71(+0.40%)May 4 4:00 PMEDT