While there is no live trading session today, the market is finally taking a breather, giving us a chance to put some more capital to work with a new put trade on Blackstone (BX).
The asset management firm is down only slightly today after reporting second-quarter results that were a mixed bag.
Distributable earnings were down nearly 40% year over year to $1.2 billion thanks to a significant decline in asset sales, predominately from its real estate and credit businesses. However, distributable earnings of $0.93 per share beat expectations by a penny.
Net profit from asset sales plummeted 82% to $388.4 million, while Blackstone’s real estate unit saw its net profit fall 94%.
On the other hand, Blackrock’s private-equity business did well, with a 20% increase in performance fees, and total assets under management hit the $1 trillion mark.
With earnings out of the way, let’s take advantage of still-elevated volatility levels and sell a put that is 5.5% out of the money.
Current Stock Price: $107.80
Action: Sell to open BX 4 Aug 102 Put for around $0.80. You can go as low as $0.75.
Target Exit Price: $0.40