I am recommending we roll our Target (TGT) put today. The stock held up well in the recent market sell-off but has not been able to retake the $150 level. We are rolling out two weeks to generate more cash and give shares time to move higher.
If you are not currently in the TGT position, please do not enter one at this time. I will alert you when it is time to put new money to work.
Current Stock Price: $147.52
- Buy to close the TGT Sep Week Two (9/11) 152.50 Put for around $5.05
- Sell to open the TGT Sep Week Four (9/25) 152.50 Put for around $6.05
- Set your initial credit limit at $1, 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.
AMAT Sep Week Two (9/11) 63.50 Call
Applied Materials (AMAT) has sold off to the tune of 14% in the past week and a half on the tech-led drubbing and the Trump administration’s re-escalation of trade tensions with China that included a threat to impose export restrictions on China’s largest semiconductor manufacturer. I do not, however, expect these short-term issues to turn into longer-term ones.
Our call is on track to expire worthless and we will sell another one next week.
Current Stock Price: $55.74
Action: Watch call expire worthless
CHWY Sep Monthly (9/18) 52.50 Call
Chewy (CHWY) is selling off sharply following its earnings announcement. While the company has yet to post a quarterly profit since going public in June 2019, its second-quarter loss of $0.08 per share was smaller than expected. Revenue was also better than expected, jumping a whopping 47% to $1.7 billion.
I think today’s sell-off is an overreaction. Our call does not expire until next week, so we are simply watching and waiting for now.
Current Stock Price: $55.49
Action: No action is needed at this time
GILD Sep Week Two (9/11) 66 Call
Gilead Sciences (GILD) is up almost 3% today, but the stock continues to languish despite anecdotal evidence that its coronavirus treatment remdesivir will be a meaningful contributor to the company’s financial performance in 2021. Supplies are tight, a clinical trial for the use of remdesivir for moderately ill patients is well underway and the company is ramping up manufacturing capacity.
Our call is currently on track to expire worthless. If it does, will sell another one next week. But if the stock continues to rise today and we get called out, we will sell a put next week.
Current Stock Price: $65.61
Action: Watch call expire
Disclosure: I have positions or trade in and out of AMAT, CHWY, GILD and TGT.