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Todd Gordon's Peloton Options Trade

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Todd Gordon's Peloton Options Trade

Todd Gordon of Ascent Wealth Partners suggested on CNBC's "Trading Nation" that investors should consider a bullish options trade in Peloton Interactive Inc (NASDAQ: PTON).

He thinks the stock might move higher on September earnings so he wants to buy the September $70/80 call spread for $3.70. The trade breaks even at $73.70 or around 5.70% above the closing price on Thursday. If the stock jumps to $80 or higher, the trade is going to reach its maximal profit of $6.30.

Peloton reported better-than-expected earnings in May, exceeding revenue expectations, and Gordon expects it to do the same in the fourth quarter. He added that the subscription revenue is crucial. Gordon is bullish on the name and he thinks there is more to it than a short-term reaction to COVID-19.

 

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