In addition to tonight's new candidate(s), consider these stocks as possible trading ideas and watch list candidates. Some of these stocks may need to see a break past key support or resistance:
COST, ORLY, CYT, DIS, FFIV, DIS, EXPE, IR, PKG, AKAM
NEW DIRECTIONAL CALL PLAYS
Delphi Automotive - DLPH - close: 70.51 change: +0.49
Stop Loss: 67.75
Target(s): To Be Determined
Current Option Gain/Loss: Unopened
Time Frame: 8 to 12 weeks
New Positions: Yes, see below
Why We Like It:
DLPH is a British company. They're also one of the largest auto parts suppliers on the planet. The stock has been a strong and steady performer for bullish investors.
The recovery in the U.S. auto market and the booming growth in the Chinese auto market has been a boon for DLPH. Wall Street analysts believe that DLPH benefits from its product mix that are focused on fuel economy, car safety, and automotive electronics. U.S. regulators are demanding a significant upgrade in fuel economy from American carmakers, which should be a tailwind for DLPH. The future of automobiles is more and more electronics, which is bullish for DLPH as well.
China will prove to be a big market for DLPH. The Wall Street Journal reports that DLPH believes its business in China could double to almost $5.5 billion by 2016.
DLPH's Q1 earnings report was strong. Analysts were expecting a profit of $1.08 per share on revenues of $4.29 billion. DLPH delivered $1.20 per share with revenues rising more than 6% to $4.28 billion. The company issued generally bullish guidance for 2014's profit and revenue estimates. DLPH also bought back 2.38 million shares of its own stock in the first quarter of 2014.
Wall Street analysts are bullish with price targets in the $84-90 range. The Point & Figure chart is bullish and forecasting at $81 target.
Tonight we're suggesting a trigger to buy calls at $71.15. If triggered we'll start with a stop loss at $67.75.
Trigger @ $71.15
- Suggested Positions -
Buy the Aug $72.50 call (DLPH140816C72.50) current ask $1.75
Option Format: symbol-year-month-day-call-strike
Entry on June -- at $---.--
Average Daily Volume = 1.4 million
Listed on June 05, 2014