Trade Alert: Bargain Hunting

Bullish options bets on two undervalued, oversold stocks.

Feb 24, 2025

∙ Paid

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Taking Advantage Of The Market Selloff

Two stocks caught my eye over the weekend, after Friday’s market selloff. Both are names we traded last year, but here’s where they stand now:

Stock #1

Beat on top and bottom lines last quarter.
Down more than 30% YTD.
Chartmill valuation rating of 9 out of 10.
RSI (Relative Strength Index) of 24 on Friday (readings below 30 are generally considered oversold).

Stock #2

Beat on top and bottom lines last quarter.
Down more than 20% YTD.
Chartmill valuation rating of 7.
RSI of 26.

For Stock #1, the options market expects a movement of 15% in either direction after it reports earnings again next month. We’re betting on the stock climbing 11% or more. If we’re right, our maximum upside will be about 300%; if we’re wrong, our maximum loss will be 100%.

For Stock #2, the options market expects a movement of about 28% in either direction. We’re betting on a gain of about 19%. If we’re right, our maximum upside will be about 300% again; if we’re wrong, we could lose 100%.

Details below.

Trade #1

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