by Ian Harvey
August 12, 2018
OUT WHILST THE GOING IS GOOD!
GREED CAN BE THE UNDOING OF A GOOD PROFIT!
Cemex SAB de CV (ADR) ADR (NYSE: CX)
Cemex on the edge supports this options put trade. This options trade was recommended to “Mentorship Program” Members on Wednesday, August 01, 2018, based on Cemex’s overbought position due to investors pricing in too much premium from possible future benefits; which has resulted in a potential profit of 66% for members!
PATIENCE PAYS OFF!
YOU NEED TO BE IN TO PROFIT!
Cemex SAB de CV (ADR) ADR (NYSE: CX), ), a company that produces and sells cement, ready-mix concrete and other construction materials, reported earnings last week; rising more than 5% in one day; and, on the surface, the news looked pretty good based on the reaction in the stock. The earnings-per-share (EPS) numbers were a bit better than average estimates, but revenue was a little low. Normally, a mixed reaction like this would have led to a drop in the share price. However, promises for future asset sales and additional cost-cutting probably saved the day — temporarily at least.
Following the financial crisis of 2008, CX lost its investment grade status and struggled for several years to refinance and reduce its debt and return to profitability. From that perspective, performance over the last two years has been admirable. However, the stock looks as if it is being overbought by investors who are pricing in too much premium from possible future benefits.
One of CX’s biggest markets is the U.S., and growth rates for U.S. construction are slowing. Just look at homebuilders like PulteGroup, Inc. (NYSE:PHM) or D.R. Horton, Inc. (NYSE:DHI) for examples of the effect that slowing growth is having on demand for construction materials and builders……continue reading…..
OPTION TRADE: Buy CX SEPT 21 8.000 PUT at approximately $0.65 TO $0.70.
The Result So Far………
In trading last week, shares of Cemex crossed below their 200 day moving average of $7.12 on Thursday, changing hands as low as $7.11 per share. And then on Friday, CX hit as low as $6.88 before closing the day at $6.99.
Cemex S.A.B. de C.V. shares are currently trading down about 4.2% on Thursday; and on Friday another 1.55%.
chart below shows the one year performance of CX shares, versus its 200 day
So, for “Mentorship Program” members who managed to execute this trade recommended by Stock Options Made Easy; and wish to take potential profits now, 66%, at last look, was available.
Entering the option trade at a cost of $0.65 or less; and now as high as $1.08; one options contract would provide a profit of $43; or 66% Potential Profit.
ACTION TO TAKE…….
It is very possible that further profit can be made from this put options trade, but as they say, “a bird-in-the-hand is better than two-in-the-bush”.
There are several choices to be decided now……
As you would have by now realized, some of our trades are based on earnings predictions. This is not to say all trades recommended to members follow this pattern, as seen in this scenario as part of the “Mentorship Program”, but during earnings season this strategy has been very profitable.
Sometimes it is our approach 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 – such as found with the “Earnings Predictions Program”. This type of prediction is based on thorough investigation and fundamentally based research, and the results have been very exceptional.
Strategies to Consider……
It is also worth considering, when options trading earnings reports – “Do we exit on already existing profits or leave the companies to report their earnings and hope for bigger profit?” .....READ MORE.....
"Trading Capital Management" is a key component of your trading strategy. The strategy, on which we base our trades to achieve maximum profit, and to minimize loss, is contingent on using an equal amount of money for each trade.……continue reading this article……
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.
If you not a member and interested in being part of this profitable action just CLICK HERE.
Other Membership Options…….
If you interested in "Earnings Predictions" just click here……
or "Mentorship Program".....click here....