Buy Alert: January 22, 2014

Marcus Haber | January 22, 2014

Buy Alert: January 22, 2014

Trade Details

Buy Unisys (UIS) February $32 Puts for $1.75 or better

Why?

It’s been a tough earnings season so far for server related companies. IBM (IBM) is down after seeing a significant reduction in server demand. Intel (INTC) also lost ground due to an unexpected slowdown in their enterprise server chip business.

Essentially, server demand is being hit hard with the rapid growth and adoption of cloud computing. Why deal with servers, data centers, and all that other expensive stuff when you can just pay someone else to do it for you?

UIS is also heavily invested in the server and data center space. With the stock trading above all of its key moving averages, I believe it’s one of the next in line to sell off.