Trade Alert: Earnings

A name from our 7777 screen. Plus, another lotto ticket.

Our 7777 Screen

Our 7777 screen is pretty simple. It includes stocks that meet these six criteria:

• Have options traded on them.

• A Chartmill overall technical rating of 5 (on a scale of 0-to5).

• Chartmill growth, health, profitability, and valuation ratings of 7 or higher (on a 0-to-10 scale).

Pulling up that screen on Tuesday night, 7 stocks made the cut. A couple of them we already have open trades on, including Powell Industries (POWL 0.00%↑).

Today’s stock has these metrics:

• Overall technical rating of 10.

• Set-Up rating (and indicator of price consolidation) of 8.

• Profitability rating of 9.

• Health rating of 9.

• Growth rating of 7.

• Valuation rating of 7.

• Piotroski F-Score Rating (on a scale from 0-to-9, with 9 being best): 8

Last time it reported earnings, back in July, it beat on top and bottom lines. It’s reporting earnings again next week, and the options market expects a movement of about $14 in either direction. Our bet is that it climbs about $8 post-earnings, and if it does, we’ll make as much as 200% on the trade. If we’re wrong, we’ll lose as much as 100%.

Another Lotto Ticket

This one’s a short term momentum options trade expiring next week on a Bitcoin miner, as that sector seems to be heating up. We’re already up about 87% on our $3 strike calls on another Bitcoin miner, Bit Digital, Inc. (BTBT 6.03%↑), the company whose CEO I interviewed below, but those are options expiring in February. Options expiring next week are a going to be cheaper so there’s a potential for greater upside in a shorter period of time with these.

Details on both trades below.

Today’s Bullish Earnings Trade