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Jim Strugger's Wayfair Options Trade

October 25, 2017 7:23 am
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Jim Strugger's Wayfair Options Trade

Speaking on Bloomberg Markets, Jim Strugger of MKM Holdings suggested an options strategy he would use in Wayfair Inc (NYSE:W), ahead of earnings.

MKM Holdings has a price target of $85 for the stock. The company is in the early stage of the online home goods market domestically and it probably has an opportunity internationally as well. Strugger believes the stock isn't expensive.

Strugger wants to sell the November 3, 76 strike call for $1.40 and buy the January 80 call for $2.80. The November 3 expiration call expires a day after the company reports earnings. The options structure would cost him $1.40 and ideal scenario for the strategy would be if the stock stays slightly below $76 at the November expiration and then it rallies above $81.40.

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