2 Stocks To Make A Quick Hit With Covered Calls Pre-Earnings

 |  Includes: CAR, NTAP
by: Mitchell Harris

Okay, it's my favorite time of the month, when options are 5 days away from expiration and real healthy returns can be gotten in short order. Here are a few I have researched this weekend, and recommend for the final week of trading for February options. The 2 companies I am highlighting here are both reporting earnings on the 15th of February, so keep that in mind. Good luck!

Avis/Budget Group (NASDAQ:CAR) is a well known, car, and truck rental company that has close to 8,000 locatios worldwide. The beauty of this stock is that they have $9.00 a share in cash, and the stock is around $14.95. This is a straight premium play, though I will tell you, they are reporting earnings on Feb 15. They are supposed to be really good, based on the comments from analysts, but put some stop losses in to protect your downside. Write the Feb 15 calls and take in 60 cents which represents 4% on your money. 97% of the stock is held by institutions. If they have good earnings, this one may join the list of classics, like SLM, USG and RGR.

NetApp (NASDAQ:NTAP) supplies enterpise storage and data management software and hardware products and services. The stock is $39.69 and the Feb 40 calls are paying 4.8% premium. They are a $14 billion dollar market cap company with $4.5 billion in cash on hand representing almost $13 per share. 98.5% of the float is held by institutions as well. It is down 33% in the past 52 weeks so any good earnings report could catapult this one into a nice option write for the next few months. Like Avis, please put in some stop losses as well.

Please message me with any ideas or comments you may have.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.