OZK is a nice regional bank at $45, which is $5Bn and they are making $660M so 7.5x is very nice with nice growth too. Also, very interesting for a bank is $1.6Bn in CASH!!! net of debt - that's crazy! This one should go into the LTP as follows:
That's net $9,800 on the $30,000+ spread that's $20,000 in the money to start with a high-enough degree of confidence that I'll make this a Top Trade Alert. Upside potential is $20,200+ (206%) and we'll start selling 5 short calls at about $50. At the moment, the April $45 calls are $3.25 so 5 short would fetch $1,625 (16.5%) for the quarter so, if we can sell the $50s for that price - that's a no-brainer.
After earnings the gains continued and the stock is already over our goal of $50 and the short puts are $5.30 ($5,300) and the $35 ($18.50)/50 ($9.50) spread is net $20,850 so net net $15,550 on the spread is up $5,750 (58.6%) in just two weeks and well on our way to $30,000 for another $14,450 (92.9%) of potential gains from here - but that's just the spread! By following through with our plan and now selling 5 April $50 calls for $3.50 (better than we expected), we put $1,750 in our pocket, which is like paying ourselves a 17.8% dividend on our $9,800 initial investment using just 76 of the 714 days we have to sell.
If we just consistently collect $1,500 per quarter for the next 7 quarters while we wait for our 92.9% return against the current balance, we can make a bonus $10,500, which is ANOTHER 100%+ of our original investment. Aren't options fun?!?
Of course, not every sale will go perfectly and that's why we're doing these updates - to get you used to the BUSINESS of trading - a business where we will teach you to CONSISTENTLY make money using these simple options techniques over time and take control of your portfolio. See you at the next update (April),
