בס״ד

Hot Soup For a Cold Market (THRM/SPXS, IBP, BG, CROX, FBHS, DE, WMS, TTC, FIZZ)

Posted on December 21, 2020

We’re offering a fireball trade today (think Tesla smothered in butter), with wicked leverage and a clearly-defined downside.

But before we get there, a quick rundown on Friday’s expiries and STOP levels.

According to the closing action from the following stocks, we’ve deduced the most appropriate STOP buy orders for each, allowing for both a cap to potential losses as well as some play for the stock.

Should a given STOP be set too wide for your own risk tolerance, tighten it up appropriately.

Here they are –

  • IBP – 111.05,
  • BG – 68.05,
  • CROX – 68.05,
  • FBHS – 94.05,
  • DE – 280.05,
  • WMS – 83.05,
  • TTC – 97.05,
  • FIZZ – 92.05.

And remember – an open STOP order must always remain on the trade.  If the STOP buy gets triggered, set a new STOP sell at the same level.  Continue the process until the trade is closed.

The underlying in question this week is Gentherm Inc. (NASDAQ:THRM), a stock that’s up 50% in the last 50 days, if you know what I mean…

They’re an industrial outfit that makes “climate comfort systems”, i.e., heaters and ACs and the like, but as the company’s fundamentals reveal, we’ve approached a white-hot stage that should have been chilled some time ago.

To wit –

  • P/E is 59.5,
  • P/B is 4.15,
  • Dividend Yield is nada, and
  • EPS for the last five years is -10.4%.

They’re expecting great things over the next year, but, then again, who isn’t?

As the technicals show, the stock has a number of less than favorable issues –

With kind regards,

Hugh L. O’Haynew

 

2 responses to “Hot Soup For a Cold Market (THRM/SPXS, IBP, BG, CROX, FBHS, DE, WMS, TTC, FIZZ)”

  1. M T says:

    I’ve got small burns and papercuts all over trying to short this market, but it is just so stretched.

    The risk/reward makes this one easy, I’m in.

    MT

  2. Hugh L. O'Haynew says:

    bs’d
    May it lead to RICHVILLE, MT!
    Best,
    Hugh
    P.S. Try a mustard plaster with aloe and olive oil for those wounds.
    😁😁😁

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