NEW BULLISH Plays
Qlik Technologies - QLIK - close: $31.10 change: -0.09
Stop Loss: 29.85
Target(s): To Be Determined
Current Option Gain/Loss: Unopened
Entry on November -- at $---.--
Listed on November 25, 2014
Time Frame: 8 to 12 weeks
Average Daily Volume = 1.6 million
New Positions: Yes, see below
Why We Like It:
QLIK is in the technology sector. The company provides business intelligence software. According to a company press release, "Qlik is a leader in data discovery delivering intuitive solutions for self-service data visualization and guided analytics. Approximately 33,000 customers rely on Qlik solutions to gain meaning out of information from varied sources, exploring the hidden relationships within data that lead to insights that ignite good ideas. Headquartered in Radnor, Pennsylvania, Qlik has offices around the world with more than 1700 partners covering more than 100 countries."
It has been a very rocky road for QLIK investors the last couple of years. QLIK's stock peaked in mid 2013. Since then shares have seen big swings both up and down. Uneven earnings results and guidance have played their part. The last four quarters have seen QLIK beat Wall Street's bottom line estimate by a penny each quarter. Yet three out of the last four quarters QLIK management has lowered their guidance.
Their most recent earnings report was October 23rd. Analysts were looking for the company to breakeven ($0.00 a share) on revenues of $124 million. QLIK delivered $0.01 a share with revenues up +26% to $131.3 million. Then management guided lower on both EPS and revenues for the fourth quarter. So why did shares of QLIK soar higher the next day?
The answer is likely the company's license growth. QLIK is seeing sharp improvement in its license growth. The first quarter it was +2% growth. The second quarter saw that improve to +11%. Last quarter it was +24% year over year.
The stock has continued to gather bullish analyst opinions. Last week the stock received a price target upgrade to $37.00. This week Citigroup added QLIK to their focus list and upped their price target to $38. The point & figure chart is bullish and forecasting at $42 target.
The stock is volatile and therefore I am labeling this a higher-risk, more aggressive trade. Investors will want to consider limiting their position size or using the options to limit risk to the cost of their option.
Technically the recent breakout past $30.00 is bullish. Yet QLIK still has resistance near its 2014 Q1 highs in the $31.25-31.55 zone. Tonight I am suggesting a trigger to open small bullish positions at $31.75.
Trigger @ $31.75 *small positions, higher-risk trade*
- Suggested Positions -
Buy QLIK stock @ (trigger)
- (or for more adventurous traders, try this option) -
Buy the 2015 Jan $33 call (QLIK150117C33) current ask $1.15
Option Format: symbol-year-month-day-call-strike