Buy Alert: May 27, 2016

| May 27, 2016

Buy Alert:  May 27, 2016

 

Trade Details

Buy Gilead Sciences (GILD) July 15th 90 Calls for $1.15 or better (lower)

 

Why?

It’s been a pretty darn bullish week for stocks, but there are still plenty of undervalued names out there.  GILD remains one of the best values in the biotech space despite having a rough year so far.  At current prices, the stock is trading at just 7x earnings (and projected earnings) and is well under its 50-day and 200-day moving averages.

Let’s buy July calls.  We have to go a bit more out of the money this time because the options are somewhat expensive.  Conservative investors can take profits at $90.  Aggressive investors can hold to $95.  For risk control, conservative traders should exit at $81, while more aggressive traders can hold to $78.

 

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Category: OTW Buy Alerts