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Week of July 18

|Includes: JNPR, SINA, YOKU

-I got somewhat lucky on the TZOO trade selling covered calls, I was buying equity at $70 and writing calls at $80 into the 07/16 option expiration. The stock was up 10% today because of earnings speculation as I had expected and really hasn't seen a significant down day in the last 2 weeks, a remarkable run given the macro backdrop (look at TZOO's performance relative to OPEN). I am still long into the print on Thursday, I think as the headline number beats the stock is going to pop no matter what the valuation is, and come off shortly after (I believe that fair value is around ~$73). I am writing the $105s calls to hedge as I don't believe it will be able to sustain a level above $100. 

-Buy VELT on all dips, given their leverage to the mobile ad space and their relatively light coverage, this is still one of my favorite positions, I believe this is also a takeout candidate.

-Buyer of JNPR. An in-line to low end range quarter is good enough at this point, given the stocks recent performance. Recall the stock dropped after they mentioned this year was going to be back end loaded. Either way in Q2 earnings guidance will give exposure to the back half. Short interest is up 45% since April 1, recall last year in June the stock was down 15% on miss concerns and rallied 5% after the print. Stock is trading around 18x ntm p/e, historically trades around 23-25x. 

-Buy YOKU, short SINA. YOKU's equity raise @ $48.18 last month gives them adequate firepower and the stock is at a huge discount to that currently. Recall in May SINA actually missed earnings expectations and was in line on the top line and still has held up extremely strong outside of a small dip.  YOKU on the other hand beat EPS and top line expectations, has signed a huge deal with warner brothers, and did an equity raise and is down 50% over the last 3 months. 

-On the macro front, the market is going to be choppy until there's any resolution on the debt ceiling. I bought on dips and covered my shorts this morning but sold at the end of the day, the market knows it will be choppy in the near term, but it also knows something will pass at the end of the day, that is how I would continue to stay positioned, in choppy waters, traders win. 


Disclosure: I am long TZOO, VELT, YOKU, JNPR.

Additional disclosure: I am short SINA.