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.
Oppenheimer raised its price target on Sonic Corporation (NASDAQ: SONC) Tuesday from $32 to $38 and maintained an Outperform rating.
Analyst Brian Bittner noted that the company pre-announced double-digit SSS for the fiscal second quarter, which was especially encouraging as the company headed into the March to August timeframe, which accounts for 70 percent of annual earnings.
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The fiscal Q2 comps came in at +11.5 percent versus Street estimates of +6 percent, with traffic as the "main contributor," according to Bittner.
Based on the second quarter performance and momentum from digital menus, a new smartphone app and enhanced advertising, Bittner raised estimates for 2015 EPS from $1.05 to $1.10 and 2016 estimates from $1.25 to $1.28. The Street had estimated $1.03 and $1.20, respectively.
Discussing margins, the analyst explained that "restaurant margins could be held in check when SONC reports full earnings owing to unquantified ‘labor investments' and mid-single-digit food inflation.
"However," they wrote, "food costs dynamics should be less of a headwind in 2H, and we still expect at least 100bps of restaurant margin expansion."
Bittner concluded that Sonic was a story with "strengthening legs."
The $38 price target was based on 14x estimated 2016 EBITDA.
Sonic Corporation closed at $33.86 Tuesday, up 0.56 percent.
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.