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For the week of December 12-16, 2011, there are a couple of under-the-radar stocks that are set to report earnings. Earnings season is still light and will be so until January 2012, but there are usually a couple of names worth viewing.

If you have not read any of my previous articles on weekly earnings trades on Seeking Alpha, please check them out. They will give you a general idea of how I like to trade using the 'strangle' option strategy.

The 'strangle' option strategy is when you purchase call and put options that are out-of-the-money, but with the same expiration date. The 'straddle' is when you buy the same expiration and the same strike price.

As with any trade, some will work out a lot better than others, so please check out my previous articles and you can make a decision if you want to use the strangle option strategy. I only choose stocks that have a history of making larger moves post-earnings report and with large 52-week price ranges. There will be times when the trade will take more time than expected. This is also why I like to have at least the next month forward on my trades.

Here are next week's trades.

Monday, December 12, 2011- No Trades

Tuesday, December 13, 2011

1.) FactSet Research Inc. (NYSE:FDS) - is scheduled to report earnings before the market opens on Tuesday.

FactSet Research provides financial and economic information to investment community worldwide. The company offers fundamental financial data on various companies, analytical applications, and client services to the portfolio managers, research and performance analysts, risk managers, marketing professionals, sell-side equity research professionals, investment bankers, and fixed income professionals.

Currently, FactSet Research is trading at 92.60/share. The 52-week range is 78.25 - 112.40.

52wk high: 112.40
52wk low: 78.25
EPS: 3.61
PE: 25.70
Div Rate: 1.08
Yield: 1.1663
Market Cap: 4.18 B
Volume: 303.79 k

Here is a closer look at how the stock has moved during past earnings reports, both before and after the release.

On September 20, 2011 FactSet Research released fourth-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Sep 22, 2011 89.42 90.25 87.61 89.00 640,517
Sep 21, 2011 91.71 92.61 90.92 91.33 554,186
Sep 20, 2011 93.34 94.99 90.61 90.88 831,341
Sep 19, 2011 85.62 89.29 85.21 88.81 401,473

From a low of $85.21/share on the day before earnings to a high of $94.99 on the day it released earnings before the markets opened, this represented a 11.4 Increase in share price.

On June 14, 2011, FactSet Research released third-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Jun 16, 2011 98.62 98.63 96.61 97.35 414,215
Jun 15, 2011 99.13 99.44 98.20 98.65 551,192
Jun 14, 2011 100.18 100.50 97.06 99.90 1,144,887
Jun 13, 2011 104.42 104.85 103.68 104.29 219,919

From a high of $104.85/share on the day before releasing earnings to a low of $97.06 on the day it released earnings before the markets opened, this represented a 7.4% decrease in share price.

On March 15, 2011 FactSet Research released second-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Mar 17, 2011 97.74 98.84 96.90 97.13 321,872
Mar 16, 2011 98.22 99.36 96.49 96.62 501,843
Mar 15, 2011 100.29 100.44 97.70 98.26 643,527
Mar 14, 2011 102.24 103.01 100.86 102.16 304,246

From a high of $103.01 on the day before releasing earnings to a low of $97.70 on the day it released earnings before the markets opened, this represented a 5.1% decrease in share price.

On December 14, 2010, FactSet Research released first-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Dec 15, 2010 92.82 93.71 91.28 91.30 413,603
Dec 14, 2010 95.00 96.86 92.40 92.81 704,449
Dec 13, 2010 95.80 96.86 95.66 96.28 206,936

From a high of $96.86 on the day before it released earnings to a low of $91.28 on the day following the earnings release, this represented a 5.7% decrease in share price.

When I first took a look at the option prices for this trade, I immediately saw what I feel is a great value if you buy this trade early. The strike prices I plan to purchase are the January 2012 $100.00 strike call options and the January 2012 $85.00 strike put options.

Currently, the bid./ask spread on this trade is $2.50- $3.05. If you use a limit order, the order should get filled at $2.75- $2.80.

Wednesday, December 14, 2011

The Pantry, Inc. (NASDAQ:PTRY) - is scheduled to report earnings before the market opens on Wednesday. (Note: the date of earnings is 12/14, but I have seen 12/13 listed. Keep an eye on this.)

The Pantry, Inc. operates a convenience store chain in the southeastern United States. Its stores offer a selection of merchandise, fuel, and ancillary products and services. It operates stores under various selected banners, which primarily include Kangaroo Express.

Currently, The Pantry is trading at $12.23/share. The 52-week range is $10.54 - $20.85.

52wk high: 20.85
52wk low: 10.54
EPS: 0.67
PE: 18.30
Div Rate: N/A
Yield: N/A
Market Cap: 280.59 M
Volume: 155.59 k

The Pantry is an interesting play. The stock has made massive moves in the past when reporting earnings. The current price-per-share is very undervalued and this company seems to be opening new convenience stores at a rapid pace. However, the stock got hit very hard the last time the company reported earnings. Here is a closer look at past earnings price moves:

On August 9, 2011 The Pantry, Inc. released third-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Aug 11, 2011 10.98 11.20 10.80 10.98 790,678
Aug 10, 2011 11.65 11.65 10.87 10.90 783,534
Aug 9, 2011 12.70 13.33 11.07 11.90 2,030,016
Aug 8, 2011 15.53 16.22 14.85 14.96 450,115

From a high of $16.22 one day before it released earnings to a low of $10.87 one day after reporting, this represented a 32.9% decrease in share price.

On May 10, 2011, The Pantry, Inc. reported second-quarter earnings and saw the following price move:

Date Open High Low Close Volume
May 12, 2011 18.34 18.64 17.85 17.89 315,205
May 11, 2011 18.84 19.09 18.22 18.32 552,369
May 10, 2011 16.98 18.59 16.82 18.21 771,860
May 9, 2011 16.38 16.58 15.88 16.05 344,567

From a low of $15.88 on the day before reporting earnings to a high of $19.09 one day after reporting, this represented a 20.2% increase in share price.

On February 8, 2011, The Pantry, Inc. reported first-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Feb 9, 2011 16.93 16.93 16.05 16.06 275,751
Feb 8, 2011 15.65 17.22 15.65 17.04 505,067
Feb 7, 2011 15.89 16.06 15.69 15.75 264,496

From a low of $15.69 on the day before reporting earnings to a high of $17.22 on the day it reported before the market opened, this represented a 9.7% increase in share price.

On December 14, 2010, The Pantry Inc. reported fourth-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Dec 15, 2010 17.96 18.50 17.93 18.37 454,764
Dec 14, 2010 18.95 19.12 17.10 18.04 944,684
Dec 13, 2010 20.19 20.49 20.03 20.15 146,599

From a high of $20.49 on the day before reporting earnings to a low of $17.10 on the day it reported before the markets opened, this represented a 16.5% decrease in share price.

To start, you should be able to place this trade relatively cheap. I am expecting a large move with this stock after reporting earnings. The strangle trade I am considering is the January 2012 $12.50 strike call options and the January 2012 $10.00 strike put options (which are going for practically nothing at this writing).

The bid/ask spread to complete the trade is currently $0.90- $1.40. Using a limit order, you should be able to get the order filled at $1.20 or less.

2.) Joy Global Inc. (JOYG) - is scheduled to report earnings before the market opens on Wednesday.

Joy Global Inc. engages in the manufacture and servicing of mining equipment for the extraction coal, copper, iron ore, oil sands, and other minerals worldwide. The company operates in two segments, Underground Mining Machinery and Surface Mining Equipment.

Joy Global is currently trading at $90.16/share. The 52-week range is $57.48 - $103.44.

52wk high: 103.44
52wk low: 57.48
EPS: 5.49
PE: 16.40
Div Rate: 0.70
Yield: 0.776398
Market Cap: 9.48 B
Volume: 2.02 M

Joy Global Inc. has really been a hit or miss type trade around earnings, so I would be cautious. Here is a closer look at some of the earnings releases and how the stock moved:

On August 31, 2011 Joy Global reported third-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Sep 2, 2011 79.39 79.39 79.39 79.39 1,749,000
Sep 1, 2011 83.73 84.41 81.39 82.06 3,160,180
Aug 31, 2011 86.79 88.45 82.17 83.45 5,039,782
Aug 30, 2011 80.62 83.29 79.85 82.54 2,545,702

From a low of $79.85 on the day before reporting earnings to a high of $88.45 on the day it released earnings, this represented a 10.7% increase in share price.

On June 2, 2011 Joy Global released second-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Jun 3, 2011 89.34 91.25 88.50 88.78 2,478,570
Jun 2, 2011 88.23 91.89 87.86 90.51 4,748,983
Jun 1, 2011 89.51 89.82 86.06 86.06 2,025,572

From a low of $86.06 on the day before earnings to a high of $91.89 on the day it released earnings before the market opened, this represented a 6.7% increase in share price.

On March 2, 2011, Joy Global released first-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Mar 3, 2011 95.42 97.44 95.36 97.33 2,818,337
Mar 2, 2011 94.00 96.87 91.67 94.32 6,898,039
Mar 1, 2011 98.53 98.84 95.15 97.17 3,864,009

From a high of $98.84 on the day before it released earnings to a low of $95.36 one day after reporting earnings, this represented a 3.5% decrease in share price. This was clearly not a good earnings play.

On December 15, 2010, Joy Global released fourth-quarter earnings and saw the following price move:

Date Open High Low Close Volume
Dec 15, 2010 83.60 87.11 83.44 85.78 6,469,891
Dec 14, 2010 80.91 81.51 79.75 80.21 1,906,116
Dec 13, 2010 79.85 81.61 79.71 80.60 1,928,892

From a low of $79.71 on the day before reporting earnings to a high of $87.11 one day after reporting, this represented a 9.2% increase in share price.

The option prices for January contracts are not cheap. If you do want to play this earnings release, you will definitely have to pay a lot for it. I am taking a very conservative angle with this trade because if there is a small move in price after the company reports, like the March 2, 2011 release, this trade can turn out to be a disaster.

Even though the strike prices I am choosing are well off Joy Global's current price, this is the only way I feel comfortable trading it. So, I will be purchasing January 2012 $105.00 strike call options and January $72.50 strike put options.

The current bid/ask spread to make this trade is $2.66- $2.82. I would be hesitant to go much above this amount.

Thursday, December 15, 2011

FedEx Corporation (NYSE:FDX) - is scheduled to report earnings before the market opens on Thursday.

FedEx Corporation provides transportation, e-commerce, and business services in the United States and internationally. It operates in four segments: FedEx Express, FedEx Ground, FedEx Freight, and FedEx Services. The FedEx Express segment offers various shipping services for the delivery of packages and freight. This segment also provides international trade services specializing in customs brokerage, and ocean and air freight forwarding services

Currently, FedEx is trading at $82.14/share. The 52-week range is $64.07 - $98.66.

52wk high: 98.66
52wk low: 64.07
EPS: 4.83
PE: 17.00
Div Rate: 0.52
Yield: 0.633066
Market Cap: 26.06 B
Volume: 2.65 M

FedEx is setting up to be a nice strangle trade. The stock has seen some major price moves in the past. Here is a look at past earnings releases:

On September 22, 2011, FedEx released first-quarter earnings and the stock saw the following price move:

Date Open High Low Close Volume
Sep 23, 2011 66.86 68.43 66.61 67.30 4,468,169
Sep 22, 2011 70.04 70.09 64.55 66.58 11,371,086
Sep 21, 2011 75.00 75.32 72.50 72.50 4,096,596

From a high of $75.32 on the day before reporting earnings to a low $66.71 one day after the earnings release, this represented a $11.5% decrease in share price.

On June 22, 2011 FedEx released fourth-quarter earnings and the stock saw the following price move:

Date Open High Low Close Volume
Jun 24, 2011 92.91 93.45 91.57 91.87 4,282,893
Jun 23, 2011 91.12 93.45 90.60 92.96 4,849,946
Jun 22, 2011 91.50 92.41 90.66 91.44 6,025,898
Jun 21, 2011 88.43 89.48 81.22 89.13 3,297,046

This was an unusual release for FedEx. The stock moved all over the place. On the day before earnings the stock reached a low of $81.22. On the next day when it released earnings before the markets opened, the stock reached a high of $92.41. This represented a 13.7% increase in share price.

On March 17, 2011, FedEx released third-quarter earnings. The stock saw the following price move:

Date Open High Low Close Volume
Mar 18, 2011 90.10 90.21 88.27 89.28 3,962,961
Mar 17, 2011 89.79 90.40 87.49 87.89 6,610,160
Mar 16, 2011 87.36 87.66 85.03 85.28 4,908,757

From a low of $85.03 on the day before it released earnings to a high of $90.40 on the day it released earnings before the markets opened, this represented a 6.3% increase in share price.

This should be a trade where you should definitely purchase early. You may even be able to sell the trade for a profit ahead of the earnings release if you do not want to hold through the release.

I am currently looking at purchasing January 2012 $87.50 strike call options and January 2012 $75.00 strike put options to complete the strangle.

The current bid/ask spread to place this trade is $3.16 - $3.26. I would pay no more than $3.50 for the spread.

2.) Research In Motion (RIMM)- is scheduled to report earnings after the market closes on Thursday.

I am not using a strangle on Research In Motion's earnings this quarter for several reasons. I will have an article out sometime this week on the trade I will be making, however.

Friday, December 16, 2011- No Trades

If you have any questions, please leave them in the comment section and I will try to respond as soon as possible.

Disclosure: I will be purchasing the strangle in the names listed in the article

Source: Option Plays To Consider For Stocks Reporting Earnings The Week Of December 12