Earnings Predictions
for the
Week Beginning October 22, 2018

Another Great Week Coming Up!

by Ian Harvey

October 21, 2018

A Quick Review of Last Week’s Market…..

Last week was another roller-coaster week on Wall Street, as traders digested a slew of big-cap earnings reports and the latest economic data. September retail sales, lackluster housing data and the minutes from the Fed's September meeting caused great confusion; but, in the end the bulls managed to win the tug-of-war.

For the week, the Dow Jones Industrial Average (DJI) finished up 0.4% at 25,444.34, holding onto positive territory for the week.

The S&P 500 Index (SPX) was up 0.02% at 2,767.78 for the week; but the Nasdaq Composite (IXIC) was down 0.6% for the week at 7,449.03.

However, stocks are still down sharply for the month. The Dow and S&P 500 have fallen more than 3 percent each in October, while the Nasdaq is down more than 7 percent.

Moving Ahead…..

The corporate earnings season is off to a strong start. With more than 15 percent of S&P 500 companies having reported, 83 percent have topped analyst expectations.

The underpinnings of the economy are still in place and earnings are still good – and it is expected that the market is not going to have an immediate recovery; it instead will bounce.

CONTROL OF EMOTIONS AND LESS PANIC ARE REQUIRED!

Big gains could be ahead for the S&P. Small-cap stocks, too, could outperform in the near term, assuming a bottom has been reached.

Reviewing the Earnings Predictions from Last Week…..

“EARNINGS Profits for LAST WEEK”!
DATE	TRADE	GAIN
October 16, 2018	UNH NOV 16 2018 270.000 CALL	P.P: 136%
October 17, 2018	ABT NOV 16 2018 70.000 CALL	P.P: 50%
October 18, 2018	PYPL NOV 16 2018 85.000 CALL	P.P: 145%

TOTAL potential profit for these 3 trades= P.P: 331%.

Cleveland-Cliffs Inc (NYSE: CLF) ended down a bit on the day, but is still in the market to pull-off some profit before expiry, which does not occur until January, 2019.

NOTE: I have previously mentioned that it is often a great strategy to exit an earnings predictions trade before earnings if there is a substantial profit to be made. This was again true for last week for International Business Machines Corp. (NYSE:IBM) as noted in the chart below…..

“Taking Profits on International Business Machines Corp. (NYSE:IBM) before EARNINGS LAST WEEK”!
DATE	TRADE	GAIN
October 16, 2018	IBM NOV 16 2018 145.000 CALL	P.P: 68%

The Decision Is Yours!

Don’t miss out – check out further options trades recommended for the week ahead by becoming a member of Stock Options Made Easy “Earnings Predictions”.

Options Trades to Consider Based on Expected Earnings Reports:

Tuesday, October 23

Industrial goods manufacturer, 3M Co (NYSE:MMM) is set to release its earnings data before the market opens. Wall Street expects 3M to post adjusted EPS of $2.70 in the third quarter, an increase of ~15.9% compared to the third quarter of 2017. In the third quarter of 2017, 3M reported adjusted EPS of $2.33.

As well, Wall Street expects 3M to report revenue of $8.39 billion in the quarter, an increase of 2.7% YoY (year-over-year). In Q3 2017, 3M reported revenue of ~$8.17 billion.

The company delivered better-than-expected results in two of the last four quarters, while reported in-line results in two. Average earnings surprise was a positive 2.22%.

Year to date, 3M's shares declined 14.9%, worse than 8.7% fall recorded by the industry it belongs to.

Rising costs and expenses might be detrimental to 3M's financial performance. An increase in retirement benefit costs, raw material cost inflation and interest expenses were primarily responsible for the increase in cost of sales in the first two quarters of 2018. 3M believes that inflation in raw material costs might remain a concern in the quarters ahead.

……..Read the rest of the report to see what options trades we are considering......

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DON'T MISS OUT - MORE TO COME!

Don’t miss out – check out further options trades recommended for the week ahead by becoming a member of Stock Options Made Easy “Earnings Predictions”.

An Important Note: That these suggestions for options trade considerations require investors/traders to use their own discretion as to when to enter or exit! As well, it is advisable to do further research and due diligence before executing your trade.

It is sometimes best to exit a trade, if there is already sufficient profit accrued, before an earnings report is presented.

GETTING OUT WHILST THE GOING IS GOOD!

GREED CAN BE THE UNDOING OF A GOOD PROFIT!

If you wish to receive more options trading recommendations similar to this, which will help boost your portfolio strategy, check out the other  memberships available at Stock Options Made Easy.

When To Exit A Trade Based On Earnings?.....

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?” 

As most traders realize, there is a 50/50 chance that the company stock price could go either way after reporting earnings – even if the report is good, the stock price could reverse – and if you hold a call option, means depletion of an already good profit if it exists. A similar situation can be found if you hold a put option, and a report is not that sound (and you expect a profit from this) but the stock price can, at times move upwards due to traders bias or other external conditions......READ MORE.....

The Decision Is Yours!

Before You Trade Consider This Strategy……

"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……

”Success is simple. Do what's right, the right way, at the right time.”

Option Tip for your Success!

Options traders are not successful because they win.

Options traders win because they are successful.

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

”Success is simple. Do what's right, the right way, at the right time.”

Option Tip for your Success!
Options traders are not successful because they win.
Options traders win because they are successful.

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