Applied Materials (AMAT) reported fiscal first-quarter results after the bell on Wednesday that beat Wall Street’s expectations. Adjusted earnings were up 21% year over year to $0.98 per share on sales of $4.16 billion. Analysts had been expecting $0.93 per share on $4.11 billion.
This was the first quarter the company reported sales and earnings growth in over a year. More importantly, management gave bullish guidance for the current quarter.
I had said that I wanted to wait for the dust to settle after earnings before putting on a new position in the stock. Now that it has, let’s sell an in-the-money put.
Current Stock Price: $67.16
Action: Sell to open the AMAT Feb Monthly (2/21) 68 Put
Current Option Price: $1.49-$1.52
Recommended Limit: Set initial limit order at $1.50, but adjust as needed to sell a put toda
And here’s where we stand with our other Perpetual Income Portfolio Club positions heading into the weekend.
CHWY Feb Week Two (2/14) 27.50 Call
Chewy (CHWY) has proven to be very resilient despite sharp moves in the market. Short-term chart support is at $27.50, and I see the stock stalling again as it nears $30. We will look to trade this range going forward.
Our shares are on track to be called away, and we will sell a put next week.
Current Stock Price: $28.68
Action: Allow shares to be called away
DAL Feb Week Two (2/14) 59.50 Call
Delta Air Lines (DAL) is holding up despite sharp movements in the travel sector due to the coronavirus outbreak, but I expect $60 to remain a short-term ceiling.
Our call is on track to expire worthless, and we will sell another one next week. If shares happen to close above our call’s strike, we will allow them to be called away and sell a put next week.
Current Stock Price: $59.01
Action: Watch call expire
LNG Feb Monthly (2/21) 57 Call
Cheniere Energy (LNG) has been hammered along with other energy-related stocks, but we will continue to ride out the storm.
This is a monthly position, so we are simply watching and waiting for now.
Current Stock Price: $55.17
Action: No action is needed at this time
Disclosure: I have positions or trade in and out of AMAT, CHWY, DAL and LNG.