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.
The Trump administration recently announced Section 232 Proclamation on imports, imposing a 25-percent duty on steel and a 10-percent tariff on aluminum imports. Against this backdrop and a number of other macro shifts on the back of global political news, Deutsche Bank revisited its thesis on the machinery group.
The Analyst
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Deutsche Bank analyst Nicole DeBlase made the following rating and price target changes for machinery stocks in the firm's coverage group:
- Oshkosh Corp (NYSE:OSK) was upgraded from Hold to Buy with the price target raised from $90 to $99.
- Cummins Inc. (NYSE:CMI) was upgraded from Sell to Hold with the price target Increased from $158 to $164.
- PACCAR Inc (NASDAQ:PCAR) was downgraded from Hold to Sell with the price target lowered from $69 to $62.
- Terex Corporation (NYSE:TEX) was maintained at Hold with a price target lowered from $48 to $45.
- Manitowoc Company Inc (NYSE:MTW) was maintained at Hold with a price target reduced from $36 to $32.
The Thesis
The 3-percent drop in the machinery group over the past month versus a 2-percent gain for the S&P 500 Index makes sense given the substantial steel content in heavy machinery, DeBlase said in a Monday note.
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The analyst — though expecting potential retribution in the form of trade war — said the recent dramatic stock price movements within Deutsche Bank's coverage universe are not fully reflective of near-to-medium-term risk in all cases.
The 11-percent and 6-percent price target reductions, respectively, for Manitowoc and Terex reflect greater price/cost risk for the crane industry, the analyst said.
The Price Action
The one-year/year-to-date price moves of the stocks are as follows:
- Oshkosh: 11.97 percent/a loss of 13.5 percent.
- Cummins: 3.15 percent/a loss of 9.78 percent.
- PACCAR: a loss of 5.06 percent/a loss of 7.19 percent.
- Terex: 22.89 percent/a loss of 20.6 percent.
- Manitowoc: 15.66 percent/a loss of 27.3 percent.
Related Links:
Buy The Dip In PACCAR, Says Longbow Research
Morgan Stanley Overweight On WABCO, Deere, Caterpillar, United Rentals Among Machinery Stocks
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.