Carter Worth Says Best Buy Losing Momentum (BBY)
Carter Worth said on CNBC's Options Action show that it appears as if shares of Best Buy (NYSE: BBY) may be running out of momentum. He cited the fact that the stock has rallied sharply in the last month and did not move appreciably higher after being upgraded at Goldman Sachs yesterday. Worth said that his analysis indicates that BBY is a "dead animal" at these levels.
If you are long Best Buy (NYSE: BBY) stock, you may be quite hesitant to sell it outright, especially in the wake of Goldman's upgrade. If you are concerned that the shares have run too far too soon, however, one strategy that you could employ is selling upside calls on the stock and pocketing the premium. If Best Buy continues to surge and your stock gets called away, you will earn both the premium for the contracts you sold and participate in at least part of the share appreciation up to the strike price of the contracts you sold.
