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.
Magna International Inc. (NYSE:MGA) has growing momentum as a “meaningful player” in emerging auto technologies, according to BMO Capital Markets.
The Analyst
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BMO Capital Markets’ Peter Sklar upgraded Magna from Market Perform to Outperform and raised the price target from $64 to $75.
The Thesis
Noting that new technology “pure plays” have been receiving higher valuation multiples, Sklar said in a Monday note that his previous view was that Magna would be left behind. (See the analyst's track record here.)
The company is significantly weighted toward legacy areas such as stamping and seating, according to BMO.
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Three recent developments have demonstrated Magna's ability in automotive technology, Sklar said:
- Magna shares have outperformed the sector since the company announced its partnership with Lyft on March 14 to equip vehicles with autonomous features.
- Magna Steyr has made a deal with Chinese automaker BAIC Group to provide complete vehicle engineering and systems integration for an electric vehicle.
- The company will supply a solid-state Lidar product to BMW in partnership with Innoviz Technologies.
The risks to BMO's thesis are the auto cycle coming to an end or a shift in investor sentiment along the same lines, Sklar said.
Price Action
Magna shares were trading up more than 3 percent at the time of publication Monday at $65.19.
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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.