I am recommending we sell an Apple (AAPL) put to generate income and reduce our net debit on the position.
The stock rallied Friday after the company delivered better-than-expected quarterly results. Revenue declined 2.5% year over year to $94.8 billion, but it was better than the $92.6 billion analysts were predicting. Sales of iPhones also exceeded expectations, up 1.5% from a year ago to $51.3 billion. And earnings of $1.52 a share, although flat compared with year-ago results, easily beat the average analyst estimate of $1.43 a share.
The company also announced plans for $90 billion in stock repurchases and raised its quarterly dividend by 4% to $0.24 a share.
Let’s take advantage of still-elevated volatility levels by selling a put. Note that this is a long-term position, and I am willing to accept shares if necessary.
You can enter today’s trade even if you were not in the previous one. Just be aware that we will be managing and tracking it based on the ongoing position.
Current Stock Price: $173.65
Net Debit: $6.35
Action: Sell to open the AAPL May Week Two (5/12) 172.50 Put for around $1.28, but adjust as needed to sell a put today
New Net Debit: $5.07