Wins of 2550% and 642%! In No Time at All! Intelligenticus Maximus (MMS, ARMK, MCD)

Maximus Inc. (NYSE:MMS) is the subject of today’s trade.

The company basically creates the governmental overreach nightmare we’ve all come to hate.  How?  By providing thick-headed, bullying bureaucrats with the software necessary to realize their vengeful agenda.

But more on that after we close two for big wins.

First, we shut down our ARMK trade, launched on February 6^th in a dispatch called Revenge of the Creepy Janitor.  There, we urged you to sell the ARMK April 21^st 44/47 CALL spread for $1.10 and buy the ARMK April 21^st 43/38 PUT spread for $1.20.  Total debit was $0.10.

And now…?

We’re recommending you buy back the short 44 CALL for $0.25 and sell the PUT spread for $2.90 (4.10/1.20).

Do it, and you skippidy-doo down the corridors of power with $2.55 NET on a dime laid out.

Mathematics informs us that’s a 2550% win.

On December 19^th we shot you a trade in McDonald’s Greases our Wallets Real Good.

The idea was to sell the MCD February 17^th 270/280 CALL spread for $3.85 and buy the MCD 270/260 PUT spread for $4.30.  Total debit on the deal was $0.45.

Today, the 270 CALL can be repurchased for $0.30 and the PUT spread can be sold for $3.34 (3.50/0.16).

Get it done and you step away with a trans-fatty $2.89 NET on just $0.45 spent.

And that’s a super-size 642% in under two months.

Our Next Steroidal Win is…

Back to Maximus.

The story here is a simple one.

The stock announced earnings last week amid the general market euphoria, and everyone got carried away.

Consider some fundamentals—

• P/E is 27.13 but forward consensus is for a drop to just 19.37 a year out.
• Dividend is 1.34%, and…
• Price to Book is 3.24.
• More than that, MMS carries too much debt—Debt/Equity is 0.99.
• EPS this year still managed to FALL by 29.60%, and…
• The latest Q/Q earnings FELL by 23.50%.

Not a romantic picture, we say.

When a government contractor can’t pull off profits, you got a big problem.

Take a look at the chart—

And that suits us fine.

Blessed be He who rules the world,

decides the fate of all, and whose Justice is perfect.

Many happy returns!

Matt McAbby

Follow @HughLOHaynew