27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
ENTER TO WIN $500 IN STOCK OR CRYPTO
Enter your email and you'll also get Benzinga's ultimate morning update AND a free $30 gift card and more!
This is concerning because ADP has "enormous scale" versus competitors so if anything, the company should have more efficiency not less, he added.
ADP's competitors are showing a competitive advantage but this doesn't have to be the case. For example, 25 percent of ADP's business competes directly with Paychex, Inc. (NASDAQ:PAYX). The rival company's CEO Marty Mucci told Cramer earlier in the week that it is able to generate strong margins by investing in technology and keeping expenses "out of the business."
Want Private Access to Benzinga Analyst?
Check out the latest strategies our team of experts are using every week so that you can always adapt to the market like the pros!—Get FULL Access to This Week's Webinar Here.
The problem is getting the message across to ADP that mimicking the success of its competitors should be considered, Ackman added. ADP's management team, led by its CEO Carlos Rodriguez, who acts "cordial" in private conversations but "behaved otherwise" in the media.
"When the founder is around and in the boardroom, you've got a major shareholder there, companies don't lose their way," Ackman said. "It's typically after the founder steps off the board, retires, passes away ... [that] the board becomes more professionalized. There's no one in the boardroom that owns a lot of stock in the company. And they get a little complacent."
Finally, Ackman's $2.3 billion position in ADP puts him "dollar-for-dollar" with the company's other investors and his ideas and vision can help all investors achieve the ultimate goal of increasing profitability.
Related Link: Bill Ackman's Pershing Square Sticks To Its Guns On Call For Changes At ADP _________Image Credit: By Raysonho @ Open Grid Scheduler / Grid Engine (Own work) [CC0], via Wikimedia Commons
27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.