Amazon’s business model is ill-suited for an environment of wage inflation, high transportation costs, and a tightening Fed. Let’s take a nice gain today, wait for Amazon’s June 6 stock split, and re-evaluate another put spread in June.
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Few industries were harder hit than the movie industry when the full-force of the pandemic hit the United States. The great danger for theatre operators is that audience behavior has changed in such a way that audiences will not return even when a broader reopening is allowed. Jim and Dan target the world’s largest movie theatre operator as new viewing habits will prevent a return to normal for theatres now and in the future.
We are closing our speculation put purchase on NAV for a 56% profit after just a few days! This is an amazing 7,300% annualized return.
Consumer spending has been the main contributor to the booming U.S. economy for the last few years. Now, with the coronavirus pandemic affecting daily lives of Americans, consumers will be curbing spending plans in favor of more savings and debt reduction. This means discretionary spending will fall. Jim and Scott target one popular gourmet food service facing this reality which will put pressure on its stock price as this crisis continues.
When the chip industry and stock market trends start moving against NVDA, history is clear that the stock can fall substantially. With the recent downturn in the market, the price target we expected for NVDA by June was hit much faster than we expected. Let’s exit this position for a profit.
It is true that the pandemic is fading, mask mandates are being dropped and live entertainment venues are gradually reopening with pre-pandemic capacities allowed. The problem is that just because the venues are open, it does not mean the crowds will follow. Jim and Dan target this leading live entertainment promoter as Americans and audiences abroad that used to attend live entertainment events will not easily lose their fear of crowds and this will put pressure on its stock price as a result.
Netflix was one of those firms who saw revenues and stock prices soar as a result of the work-at-home and quarantine rules issued by state governments. But now demand is waning. Jim and Scott target this on-demand media service as the best way to profit as the combined impact of competition, a COVID vaccine and an inflated valuation takes their toll.
