Company: 3D Systems
Ticker Symbol: DDD
1/31/13 Update… Stopped out @ 15% loss 3D Printer stocks in downward trend. I will still long in our Tomorrow’s Treasures Portfolio (small and mid cap stocks) but out on the Renegade Portfolio.
1/25/13 Analysis… Seeing a lot of call buying on 3D Systems. It reports earnings Feb 25th and could see a good boost between now and then. This is a stock that has been in our Tomorrow’s Treasures Portfolio for the past year and is up over 250% since we first bought it. 3D Systems Corporation, through its subsidiaries, engages in the design, development, manufacture, marketing, and servicing of 3D printers and related products, print materials, and services.
Many times investors miss opportunities because they do not know where to look:
• What about companies about to be acquired?
• Or companies about to sign a major contract or exciting new deal?
• How about companies up for FDA approval or about to announce a major medical break through?
• Or maybe companies about to release a major positive earnings surprise?
• Or even companies that had unjustified sell-offs and are about to rebound?
What do all of these events have in common? You guessed it, they each provide a major catalyst that can send a stock soaring in a matter of days or weeks. At Wall St Renegade, we find these types of opportunities each and every week simply by monitoring option activity.
Investors often use option trading to speculate on events about to take place (like the list above)…
Someone who wants to participate in the upside of a stock’s price movement could purchase shares or buy call option contracts to control the underlying stock. Calls give investors the right but not the obligation to purchase a stock.
Let’s look at a quick example. Let’s say a stock was trading at $15. In order to buy 100 shares it would cost $1,500 plus commission. Instead of putting up $1,500, the investor could buy 1 option contract that controls the same 100 shares of the stock for a fraction of the price. The disadvantage is that the contract has an expiration date. So let’s say this investor can buy a $15 strike call (at the money) for $100 for the next 30 days. This $100 (premium) allows the investor to fully participate in the upside of the stock while committing $100 instead of $1,500. The downside is that if the stock stays at $15 or drops below that price, the contract will expire worthless and the investor loses the full $100 premium he paid.
Now let’s say during the 30-day period the stock has a major catalyst and the stock soars, going from $15 all the way up to $25. Now the investor’s option contract will increase by at least $1,000 (a 1,000% rate of return or 10x their money). So options provide leverage!
Now when our Renegade system spots investors heavily speculating on a particular company, it shows up in the premiums investors pay (the higher the call premiums, the more likely investors are betting the stock price will soar). Each evening our system monitors option activity to identify which companies investors are highly speculating on. This leads us to companies about to have major catalysts (positive and negative). After doing additional research, we dive in and try to determine which companies have the highest probability of producing positive results. This process is the foundation of what we do at Wall St Renegade.
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Company: Sangamo BioSciences, Inc.
Ticker Symbol: SGMO
Action: Buy (up to $10.00)
4/1/2013 Analysis… I will be allocating 10% to Sangamo BioSciences (SGMO) with a buy up to $10. It is engaged in the research, development and commercialization of engineered DNA-binding proteins for the development of novel therapeutic strategies for unmet medical needs. This stock has been on fire in 2013 (up 64%). It’s above its 50-day moving average of $9.34 a share with decent upside volume flows. I am looking for its next major overhead move to $10.50 to $11.25 a share. This is a HIGH RISK trade. My stop loss will be 20% below entry.
Sangamo BioSciences, Inc. (SGMO) is a clinical stage biotech company
developing gene expression and modification technologies. Specifically, Sangamo is
focusing on engineering zinc finger DNA-binding proteins (ZFPs) to turn genes on or
off. The company’s most advanced drug candidate is SB-728-T, a ZFN-modified
autologous T-cell product, which is currently in Phase II and Phase I/II clinical trials for the treatment of human immunodeficiency virus (HIV) and acquired immunodeficiency syndrome (AIDS). Sangamo also has five additional drug candidates using the ZFP platform currently in the pre-clinical stage, indicated for the treatment of diseases such as Hemophilia and Huntington’s disease. Moreover, Sangamo has strategic partnerships signed with a number of large biotech companies including Shire, Dow Agrosciences, and Sigma-Aldrich. To date, these partnerships have brought in over $90 million in revenue to the company, and are expected to produce seven new Investigation New Drug (IND’s) applications over the next three years.
Company: Green Mountain Coffee Roasters
Ticker Symbol: GMCR
8/28/13 update… Sold 100% of GMCR today at 21% gain.
7/7/13 update… I am adding a 10% position in Green Mountain Coffee Roasters (GMCR) with a buy up to $75. It is about $10 off its 52 week high and has earnings coming up. Option activity is picking back up again. This stock could easily bounce back into the mid $80s. Looking for a 3-4 week swing on this one. Green Mountain Coffee Roasters, Inc. engages in the specialty coffee and coffeemaker businesses in the United States and Canada.
4/26/13 Analysis… I will be adding 10% to Green Mountain (GMCR) again going into earnings. This is seeing strong option activity ahead of its earnings on May 8th. Looking for a 10% pop on this one. It is a good buy up to $57.50 and a MEDIUM RISK trade. Green Mountain Coffee Roasters, Inc. engages in the specialty coffee and coffeemaker businesses in the United States and Canada. It sources, produces, and sells approximately 225 varieties of coffee, cocoa, teas, and other beverages in K-Cup and Vue single serve packs; and coffee in traditional packaging, including whole bean and ground coffee selections in bags, and ground coffee in fractional packs.
3/11/13 Update… Green Mountain continued its climb and we are now up 30+%. I have raised my sell target to $57-$60, as it is still ranked a strong buy in our system. This week it inked another deal. This weak it was with food and personal care products giant Unilever to let consumers brew a spot of Lipton tea, one cup at a time.
1/19/13 Analysis… Buy up to $42. I will put a 10% stop loss below my entry price. It reports earnings on the 23rd this month and seeing heavy call buying or Feb and March. This could hit $50 with a good report. It engages in the specialty coffee and coffeemaker businesses in the United States and Canada. It sources, produces, and sells approximately 225 varieties of coffee, cocoa, teas, and other beverages in K-Cup and Vue single serve packs; and coffee in traditional packaging, including whole bean and ground coffee selections in bags, and ground coffee in fractional packs.