Mike Khouw spoke on CNBC's Options Action about a bullish options trade in McDonald's Corporation MCD.
The company is going to report earnings on Tuesday and Khouw thinks the stock is going to continue to trade higher. To make a bullish bet, he wants to buy the September 135 call for $3.40. The trade breaks even at $138.40 or 3.74 percent higher.
Khouw likes McDonald's because it's well positioned if it decides to enter a delivery business. The company also has benefits in terms of cost, relative to the other companies in the sector. The combination of cost savings and a possibility of a new business are the reasons why investors are willing to pay the premium for the stock, thinks Khouw.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
