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  • Whole Foods Market (WFM) Gets Walloped After Earnings Miss

    Whole Foods Market (NASDAQ:WFM) Gets Walloped After Earnings Miss

    12:20pm (EST)

    With economic news light, the market has been left to deal with earnings that have been above expectations for the recently ended quarter. While the bottom lines have surprised, revenue beats have been unflattering. The growth stocks and momentum names that have missed expectations have been getting crushed and Whole Foods Market (WFM, $38.60, down $9.35) can be added to the list.

    Shares are down 20% following the company's earnings announcement after Tuesday's close.

    Whole Foods missed Wall Street's estimates by 3 cents after reporting a profit of $0.38 a share versus expectations for $0.41 a share. Revenues also came in shy as analysts were expecting $3.34 billion compared to the $3.3 billion reported.

    To make matters worse, the company lowered full-year guidance to $1.52-$1.56 a share, down from a previous forecast of $1.58-$1.65 a share. The suit-and-ties have been looking for $1.61 a share for 2014.

    A nice lottery trade would have been buying the May 45 puts (WFM140517P00045000, $6.10, up $5.50) ahead of yesterday's close as they are surging over 900+% today!

    The May 40 puts (WFM140517P00040000, $1.71, up $1.65) went out at 6 cents yesterday and are up a whopping 2,750%! I have included the Yahoo snapshot of the quote (see website).

    (yahoo option quote snapshot)

    As options traders, these are the reasons we play the game.

    The market is getting a mixed and has been volatile following Fed Head Janet Yellen's comments who said small-caps might be overvalued.

    The Dow is gaining 95 points to 16,496 while the S&P 500 is up a 6-pack to 1,874. The Nasdaq is down 27 points to 4,053 and the Russell 2000 is slipping 3 points to 1,104.

    Tags: WFM
    May 07 12:31 PM | Link | Comment!
  • Apple (AAPL) Finally Splits Stock

    12:45pm (EST)

    Wall Street fretted over Apple (AAPL, $566.47, up $41.72) and Facebook (FB, $61.84, up $0.48) but we told our subscribers to hang tight as we heard the bulls playing some Seger into the close (Like a Rock). Whenever that classic is playing, something good always happens.

    We nearly did a backflip after hearing the good news Apple finally split its stock. Yes, we know it doesn't really mean anything as your investment is still the same, just more shares. However, as option traders it is big-time news as it creates cheaper options.

    Apple is going to split its stock 7-to-1 and shares would be trading just north of $80 at current levels. This is absolutely incredible folks and it will lead to a flood of buying this year now that water-cooler talk of the company joining the Dow. For those of you that have our option trading manual "How to Trade Options on Momentum Stocks" make sure you read the chapter on stock-splits. We will be talking a ton about Apple in the coming weeks.

    As far as the company's numbers. Two words. Mind Blowing.

    Apple reported a profit of $11.62 a share, or a whopping $1.44 beat! No weather worries that's for sure. The Apple TV set-top boxes are selling like hotcakes as more than 20 million are in homes. They have over 800 million iTunes users and are a stone's throw from the magical 1 billion mark.

    If we keep things really simple, if every iTunes user buys an Apple TV set-top box for $100 the potential on those numbers alone are fascinating.

    Tim Cook came out swinging and said "If I look broadly at the contents on Apple TV, I think it compares extremely favorable to the content that is on the Amazon box."

    Let the games begin.

    We could talk about Apple all day but we have some super important updates today with our current trades and we are adding 2 New Trades to the Daily portfolio. We also have new Weekly Wrap trades coming as well.

    As we make the turn, the Dow is up 19 points to 16,521 while the S&P 500 is gaining 5 points to 1,880. The Nasdaq is higher by 25 points to 4,152 and the small-caps are popping a point to 1,148.

    Apr 24 12:59 PM | Link | Comment!
  • Dow, S&P 500 Turn Positive For April

    The bulls are pushing and clearing resistance after a number of positive earnings reports have Wall Street in a good mood. M&A has also picked up in recent weeks which is adding fuel to the fire but nothing is a given until we see how today's close goes.

    There are a number of heavy-hitters reporting their numbers this week and we should have a good clue by Friday if a run to new highs is a real possibility, or, a continued trading range with the chance of another pullback.

    We have remained bullish all year long despite the choppiness and volatility but trading ranges are hard to trade if you are on the wrong side. A lot of hedge fund managers went short on last week's drop but we reminded our readers nothing was broken and to stay long as the most hated rally in history could continue.

    As we head into the second half of trading, the Dow is up 67 points to 16,516 while the S&P 500 is gaining 7 points to 1,878. The Nasdaq is higher by 30 points to 4,152 and the Russell 2000 is popping a 8 ticks to 1,150.

    We are in the process of building out our next batch of trades and we can be a little aggressive given the gains we have made this year. With that said, we have a New Trade on a stock that has been a favorite of ours for years. Shares have been beaten up but we believe a run to fresh 52-week peaks is on the horizon.

    Subscribers, check the Members Area for the New Trade and current updates. We could have additional updates today so stay locked-and-loaded into the close in case we take action.

    Apr 22 11:44 AM | Link | Comment!
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