Tesla Falls – Option Puts Gain!

86% Potential Profit – More To Come!

by Ian Harvey

November 03, 2017

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Tesla Inc. (NASDAQ:TSLA)

Here is an overview of Tesla Inc. (NASDAQ:TSLA) winning options put trade after reporting earnings. This options trade was recommended, as a consideration, on Monday, October 30, 2017 in the article “Earnings Predictions for the Week Beginning October 30, 2017”; producing great profits within a few days of executing the trade!

The Recommendation……

…….from “Earnings Predictions for the Week Beginning October 30, 2017”.

The Details……..

Tesla Inc. (NASDAQ:TSLA) will report earnings after the market closes. The consensus estimate is for a loss of $2.27 per share on revenue of $2.92 billion and the Earnings Whisper number is ($2.54) per share. Investor sentiment going into the company's earnings release has 21% expecting an earnings beat.

Historically, Tesla tends to see a rally ahead of its earnings calls, but TSLA stock is headed the other direction now as downgrades are taking their toll on the stock price..

TSLA shares have lagged the market and tech stocks meaning that the "smart money" is starting to migrate away from the stock.

Tesla stock is now stuck in a volatility sell-off that is targeting a move below $320. A break below $320 will move TSLA stock below its 10-month and 200-day moving average. This will be a key technical mark against the stock causing even more selling pressure.

The Trade……..

** Option trade to consider: Buy the TSLA DEC 15 2017 300.000 PUT at approximately $10.80.

Note: However, this could have been executed at approximately $8.00 instead after the market opened on Monday.

The Report………

Shares of Tesla (NASDAQ:TSLA) fell as much as 8.9% on Thursday, in the aftermath of the company's third-quarter earnings release; after the EV automaker reported its biggest quarterly loss ever. The company also pushed back production targets for the Model 3 by about three months, saying it was difficult to predict how long it will take to fix bottlenecks. The car, whose price starts at $35,000, is widely seen as key to Tesla's  future.

The stock's decline likely reflects disappointment in the company's wider-than-expected loss per share and an approximately three-month delay for Model 3 production. Tesla reported a non-GAAP loss per share of $2.92, worse than its non-GAAP gain per share of $0.71 in the year-ago quarter and worse than a consensus analyst estimate for a loss of $2.31.

Tesla's revenue and vehicle sales were up in Q3, rising about 5% and 30% year over year, respectively, compared to the year-ago quarter. But production bottlenecks for Model 3 weighed on results and guidance.

“While we continue to make significant progress each week in fixing Model 3 bottlenecks, the nature of manufacturing challenges during a ramp such as this makes it difficult to predict exactly how long it will take for all bottlenecks to be cleared or when new ones will appear,” Tesla said in a statement.

End Result……..

At the time of the recommendation, Monday morning, TSLA stock price was sitting at $320.87.

By the end of trading Thursday the stock price had settled at $299.26; down -$21.82 or 6.80% from the previous days trading.

The Profit……..

So, for those traders who managed to execute this trade recommended by Stock Options Made Easy; a nice tidy potential profit of 86% within a couple of days.

ACTION TO TAKE…….

As you would have by now realized, many of our trades are based on earnings predictions. This is not to say all trades recommended to members follow this pattern, but during earnings season this strategy has been very profitable.

Our approach is to predict whether a company will beat or miss estimates, whether the stock will appreciate or depreciate as a result and what strategies investors and traders can use. This type of prediction is based on thorough investigation and fundamentally based research, and the results have been very exceptional.

Our proven track record says it all!!

Members of Stock Options Made Easy are provided with an extensive reason as to which direction a stock will move after earnings, followed up by a recommended options trade.

What To Do Now…….

If you interested in being part of this profitable action just click here……


Best of Trading,
Ian Harvey
Director of Stock Options Made Easy


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