CAT Puts

 This is a strange story. The stock Faraday Future sank on Wednesday by about 17% after recently doing a  80-1 reverse stock split. Then the stock went down about half-price again the day after. This time they announced that they would be issuing additional shares, for about an amount of 90 million dollars. If you have an EV company to run, that's not very much money. To add to the confusion a share buyback program to help support the stock's price was recently announced. You can't have it both ways. You can't be issuing new stock and buying it back at the same time. Money was recently wasted on that activity. Short-selling activity has plagued this company. Short sellers so far have won. When you have already three billion into the company and have only produced three vehicles there is a problem. But wait, if you don't know the story it's a California-based company that has just cranked out a few ( once again only three) high-end EVs and sold them to celebritie...

A multitude of factors have kept Boeing down since my last blog about it in April. What happened this morning was a touch unusual. First the five-day and one-day chart. Now this. Can you see the morning jump at 11:00 a.m.? The top reason for looking for opportunities like this is that the weekends often wash away negative sentiments if only for a brief period. These are "out-of-the-money" Calls with 4.5 days of trading life in them. If they had only one or two days of trading life in them then the risk of trading them would be too great. Note how the volume of contracts traded greatly exceeded the open interest. Traders got in and out. Traders recognized a break-out pattern. What's going to happen next is anyone's guess. This is short-term options trading. Stocks in the 200.00 dollar price range offer more opportunities like this than stocks trading under $100.00. That's just the way it is. Let's now look at this morning's action in Fisker. It's a...

First of all, I like writing blogs that have in their heading the words "Cat Puts". That causes the number of hits to this site to go ballistic. I try however not to abuse this privilege. When Caterpillar releases its quarterly profit reports retail investors are allowed to capitalize on this glee. The release of its most recent second-quarter profit report saw a one-day surge of over $20.00 in its price. Earnings were expected to be good as Caterpillar was on a role. I wrote about this activity back on July 30th. What a dream for option traders. Following the release of this good news, retail investors also got to enjoy playing the downside as its precious spike upward started to crumble, taking the stock back down from its new nosebleeding level. Opportunist option players have trained themselves to look for this kind of action with the mentality of catching the excess exuberance in the air. It's not only Caterpillar that offers these tradable moments. Look at how FedEx...

Strong profits and strong vehicle demand. Investors in Ford have opted to discount the cost of future labor demands. Management might have a different slant. Take a hit on plants closing and let the demand for new vehicles heat up (or help reduce the need for dealers to offer incentives). Interesting times. Tesla seems be running with more efficiences.**Barron's coverpage on Sept 18th reads.The EV Wars, As General Motors and Ford confront a UAW strike, they're falling behind rival Tesla in the battle over electric vehicles. Can they catch up? Their article notes that in July, Ford increased it's EV division's full-year projected loss to 4.5 billion from 3 billion, while pushing back a goal of producing roughly 50,000 EVs a month from the end of 2023 to some point in 2024. In the U.S., Ford sold some 32,000 EVs in the first seven months of the year, up 3.5% compared with 2022. (Tesla sells more than 58,000 cars a month in the U.S. and produces 150,000 EVs every month a...

After years of work they now have three truck sales. Now this. Would I be buying this stock? NO. Another reverse stock split seems to be in the wind. On a differing note "Faraday Future" is busy running around race tracts breaking speed records. I guess they are burning off steam after recently doing a 1-80 reverse stock split. Image that! Yes it really did happen. What a crazy race to go electric.** Now Mullen again one week later.

Pension funds invest in EV stocks. Currently Lucid is 81% owned by institutions and 4% insiders. Rivian is 63% owned by institutions and 12% insiders. It's not the average guy on the street who own these two stocks. What do institutional investors know about stocks in this sector that we don't? Tesla is 44% owned by institutions and 13% by insiders. Workhorse is 33% owned by institutions and 4% insiders. In contrast Polestar is only 4% owned by institutions and 47% by insiders. Lucid and Rivian are both up and running with production output. For this reason they both seem to be gaurishing an inordinate amount of attention. Please now read this. After you finish reading this I will tell you what I think. It seems to me that institutions are out in the garden patch whimically putting EV stocks into their basket. What a dangerous voyage of discovery. Yet what floats the boat is Tesla which has had a wonderful run. The scary part is that this stock has a P/E ratio of 71:80-1. The ...

Do you remember Polestar going public at $10.00 a share? Look at how it has struggled. It dropped further this week on a disappointing quarterly earnings report. Maybe next week it will bounce back again. It's still in business and advanced new models are soon on the horizon. It could be like the Nio report last week. Nio bounced back after reporting a quarter of lower production numbers. Other upstart electric vehicle companies like Rivian and Fisker are also struggling to be profitable. Remember I recently mentioned Faraday Future doing a 70 for 1 reverse stock split? How crazy was that? A ten for one reverse split would have got them over the magical $1.00 mimimum trading treshold and kept it as one of the most actively traded stock on the Nasdaq. Here is how it traded this week after their announcement. Their stock in now sinking into oblivion. Then there is a newly listed Vietnamese company called VinFast with vehicles arriving to North America and plans to buld a factory in ...