“Cut-to-the-Chase” Recommendations
- Week Beginning -
Monday, April 02, 2018

by Ian Harvey

IMPORTANT NOTE: There is no stop-loss or pre-determined sell price recommended – this is left to the discretion of the individual trader.



Option Trade - - Crocs, Inc. (NASDAQ: CROX) Puts

Wednesday, April 04, 2018

** OPTION TRADE: Buy CROX MAY 18 2018 16.000 PUT at approximately $0.90 each. Sell price is left to your own judgment.

Crocs, Inc. (NASDAQ: CROX), engaged in the design, development, manufacturing, marketing, distribution and sale of casual lifestyle footwear and accessories for men, women, and children, have had quite a run in the past six months, from $9 in September to nearly $16 last week. In fact, the stock rallied 3.6% during a week when the market fell 6%.

On February 28, after the company reported an 11% earnings miss, the stock gapped down to $12. Stifel Nicolaus analysts put out a note recommending investors buy the pullback which offered sizable upside to their still-intact price target of $16.

And Piper Jaffray analyst upgraded CROX from Neutral to Overweight with a $15 PT.

Well, those goals have been quickly achieved in just 4 weeks since the company reported their Q4. But when you look at the recent lukewarm recovery in earnings estimates, one has to wonder if all this bullishness is justified.

And now analysts are looking at a turnaround.

Influencing Factors

After 3 big earnings beats in 2017, this year's profit projection is no higher than it was over a year ago. The stock price has run well ahead of the earnings turn-around from three years of losses to finally one of profitability again.

The corresponding sales growth projections are nothing to get excited about with a 0.5% advance this year from $1.02 billion to $1.03 billion. And next year's top line is only slightly more positive at $1.06 billion, for a mere 2.6% bump.

Analysts and Hedge Funds Opinions

Zacks Investment Research lowered shares of Crocs from a hold rating to a strong sell rating in a research report published on Monday, March 19th.

According to Zacks, “Crocs, Inc. is a world leader in innovative casual footwear for men, women and children. Crocs offer a broad portfolio of all-season products, while remaining true to its core molded footwear heritage. All Crocs™ shoes feature Croslite™ material, a proprietary, revolutionary technology that gives each pair of shoes the soft, comfortable, lightweight, non-marking and odor-resistant qualities that Crocs fans have known and love. Crocs celebrate the fun of being a little different and encourage fans to Find Your Fun in every colorful pair of shoes. “

Several other analysts have also recently commented on the company…..

  • Pivotal Research reiterated a hold rating and issued a $13.00 target price (up from $10.00) on shares of Crocs in a report on Wednesday, January 10th.
  • BidaskClub upgraded Crocs from a hold rating to a buy rating in a report on Thursday, March 15th.
  • Buckingham Research upped their target price on Crocs from $7.00 to $9.00 and gave the stock an underweight rating in a report on Thursday, March 1st.
  • Finally, CL King cut Crocs from a buy rating to a neutral rating in a research note on Monday, November 20th.

Two analysts have rated the stock with a sell rating, three have issued a hold rating, four have assigned a buy rating and one has given a strong buy rating to the company. Crocs have an average rating of Hold and an average price target of $11.00.

Institutional investors that have recently made a change to their positions in the stock….

OppenheimerFunds Inc. lessened its stake in Crocs by 26.5% in the fourth quarter. The institutional investor owned 55,291 shares of the textile maker’s stock after selling 19,975 shares during the quarter.

Summary

Don’t be surprised if the stock drops back to $12 again.

Crocs has a 12-month low of $5.93 and a 12-month high of $16.59. The stock has a market capitalization of $1,118.50, a price-to-earnings ratio of -829.00, a P/E/G ratio of 3.47 and a beta of 0.29.


Option Trade - - AngloGold Ashanti Limited (ADR)(NYSE: AU) Calls

Tuesday, April 03, 2018

** OPTION TRADE: Buy AU APRIL 20 2018 9.000 CALL at approximately $0.80each. Sell price is left to your own judgment.

Again we saw U.S. equities are under serious pressure yesterday, with the S&P 500 finally breaking hard below its 200-day moving average after flirting with that critical technical support level for weeks.

This is causing some bad news bad news for big-tech stocks like Amazon.com, Inc. and Facebook, Inc. as well as second-stringers like Tesla Inc.

As well, there are lingering issues which include fears over a U.S.-China trade war and the approach of Friday’s non-farm payroll report, which could confirm worries about wage-push inflation.

It appears that short-side bets are about the only plays that are coping with this volatility.

But now, precious metals are perking up as well, with gold the top-performing asset in recent months. And now, finally, gold mining stocks are following metal futures higher.

And one company that stands out at the moment is AngloGold Ashanti Limited (ADR)(NYSE: AU). Shares are emerging back up and over their 200-day moving average, setting up a run at the January high that would be worth a gain of more than 20% from current levels.

The company recently reported second half results back on Feb. 20, where earnings of 28 cents beat estimates by 10 cents (but may not be a clean comparison) on revenues of $2.3 billion.

Production increased 7% from 2016 while total cash costs were up just 1%.

Analysts and Hedge Funds Opinions

Zacks Investment Research upgraded shares of AngloGold Ashanti from a “hold” rating to a “buy” rating and set a $11.00 price objective on the stock in a research report on Wednesday, February 14th.

Also, ValuEngine upgraded shares of AngloGold Ashanti from a “sell” rating to a “hold” rating in a research report on Thursday, March 1st.

One analyst has rated the stock with a sell rating, four have assigned a hold rating and five have given a buy rating to the company. AngloGold Ashanti has an average rating of “Hold” and an average target price of $11.25.

Institutional investors that have recently made a change to their positions in the stock….

  • Deutsche Bank AG increased its position in AngloGold Ashanti by 233.0% in the 4th quarter. Deutsche Bank AG now owns 3,336,817 shares of the mining company’s stock valued at $34,002,000 after buying an additional 2,334,622 shares in the last quarter.
  • Amundi Pioneer Asset Management Inc. bought a new stake in AngloGold Ashanti during the 4th quarter worth approximately $14,112,000.
  • Arrowstreet Capital Limited Partnership bought a new stake in AngloGold Ashanti during the 4th quarter worth approximately $7,335,000.

Insider News……

AngloGold Ashanti Director Lotan Holdings Inc. acquired 25,000 shares of the firm’s stock in a transaction on Thursday, March 8th. The shares were acquired at an average price of $0.83 per share, with a total value of $20,750.00.

Summary

Watch for a run to the late January high near $11.75, which would be a gain of more than 20% from current levels.

AngloGold Ashanti has a 12 month low of $8.86 and a 12 month high of $13.31. The company has a debt-to-equity ratio of 0.82, a current ratio of 1.57 and a quick ratio of 0.63. The firm has a market cap of $3,884.84, a PE ratio of 162.50 and a beta of -0.93.






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