I am recommending we roll our Applied Materials (AMAT) and Chewy (CHWY) positions today.
AMAT was on track to expire worthless before today’s sell-off on the heels of Intel’s (INTC) earnings announcement. The industry bellwether reported better-than-expected earnings but saw an unexpected drop in its server segment.
We are going to roll our AMAT put out one week to buy time and pick up some cash in the process.
CHWY sold off this week, unable to move into a higher trading range. I am recommending we roll our put out two weeks. This will buy us some time for shares to resume their ascent and bring in more cash.
AMAT Oct Week Four (10/23) 62 Put
Current Stock Price: $60.93
- Buy to close the AMAT Oct Week Four (10/23) 62 Put for around $1.24
- Sell to open the AMAT Oct Week Five (10/30) 62 Put for around $1.68
- Set your initial credit limit at $0.44 but adjust as needed to roll today
CHWY Oct Week Four (10/23) 67.50 Put
Current Stock Price: $63.39
- Buy to close the CHWY Oct Week Four (10/23) 67.50 Put for around $4.75
- Sell to open the CHWY Nov Week One (11/6) 67.50 Put for around $6.05
- Set your initial credit limit at $1.30 but adjust as needed to roll today
And here’s where we stand with our other Perpetual Income Portfolio Club positions heading into the weekend.
GILD Oct Week Four (10/23) 61 Call
Gilead Sciences (GILD) is up today on news remdesivir has become the first branded drug to receive full approval from the U.S. Food and Drug Administration as a COVID-19 treatment.
Our call is currently in the money and we are on track to have our shares called away. With the company announcing earnings next week, that is ideal as I’d prefer to sit the announcement out. If, however, the stock closes below $61, our call will expire worthless and I may recommend selling the shares before earnings come out.
Current Stock Price: $61.32
Action: Watch call expire
TGT Oct Week Four (10/23) 165 Put
Target (TGT) sold off this week but I expect the stock will enjoy another leg up soon. The company was featured in the “The Robin Report” in a great piece that looks at why the retailer has been outpacing it competitors before and during the pandemic.
I am recommending we accept shares. We will sell a call against them next week.
Current Stock Price: $158.94
Action: Accept shares
Disclosure: I have positions or trade in and out of AMAT, CHWY, GILD and TGT.