Write it Down—2713%, 2122% and 713%. McDonald’s Greases Our Wallets Real Good (MCD, TPOR/DUSL, BMY)

A few public surgery announcements before we begin.

CORRECTION

First, we made an error computing our TPOR/DUSL trade winning last Friday.  It’s now been corrected on the site.

The win was 2713%, and not 100%, as originally posted.

See HERE.

Fair is fair, Katie.  Sometimes big wins get bigger.

And now we’ve got one to close

It’s our BMY trade from just a week back.

The letter was called If You Have to Take Drugs…, and there we urged you to sell the BMY February 17^th 80/82.50 CALL spread for $0.93 and buy the BMY February 17^th 77.50/75 PUT spread for $0.88.  Total credit was $0.05.

And now?

There’s still two months remaining before expiry, but we like the sum that awaits us—and the time frame in which it was procured.

JUST SEVEN MEASLY DAYS!

So we’re closing.

Buy back the CALL spread for a debit of $0.33 (0.57/0.24) and sell the PUT spread for $1.50 (5.05/3.55), and you NET $1.22 on NOTHING laid out.

Adjusted for minimal commissions gives you a winning of 713%.

That’ll teach the liars!

We’re flipping the McDonald’s burger today, in a splendidly crafted work of options finesse that ONLY the floor traders of MCD could have assisted us with.

…And that could pocket us a healthy 2122% on a move of just over two percent!

But before we do…

Consider the fundamentals—

• P/E for this legacy synthetic meat fryer is a whopper 33.52 (!) – though analysts agree a year from now that will shrink to 25.42 (or much less, after the tsunami hits).
• Dividend Yield is reasonable—relative to the current market—at 2.28%.
• But Price to Book is non-existent, and…
• Q/Q Sales and Earnings have SHRUNK by 5.30% and 6.20% respectively.
• Beyond that, Return on Equity for this pusher of trans-fats is a super size NEGATIVE 100.50!

Now look at the daily chart—

G-d help us succeed against all the evility of this world!—

May the Holy One bless us with long life, healthy children and grandchildren, wealth beyond our wildest imaginings, and a world without Klaus Schwab and his scheming, evil henchmen.

We’ve a hunch we’ll be closing this one out in rather short order.

With kind regards,

Hugh L. O’Haynew

Follow @HughLOHaynew