July 28, 2023
Sell a Third of Existing Position: Sell a Third of your INTC January 34 Calls for $4.50 or more.
Intel (INTC) reported earnings yesterday afternoon that beat expectations. In reaction to those numbers INTC stock is trading higher by 4%.
Let’s stick to the plan, lock in a profit of approximately 20%, and then go for greater gains in the weeks and months to come.
To execute this trade you need to:
Sell to Close a Third of the INTC January 34 Calls
June 28, 2023
Buy the Intel (INTC) January 34 Calls (exp. 1/19/2024) for $4.25 or less.
As I’ve written up recently, Intel (INTC) has attracted very bullish option activity, and the stock was showing signs of life. However, in the last week the stock has come under some selling pressure and is lower again this morning on potential semiconductor/China-related news.
And while the stock is down 1.25% today, call buying continues in the stock, including these trades this morning:
Buyer of 30,000 Intel (INTC) October 38/44 Bull Call Spread for $0.87 – Stock at 33.7
Buyer of 10,000 Intel (INTC) July 34 Calls for $0.81 – Stock at 33.
While my bias is to turn a blind eye to INTC because it’s been a dog for so many years, the option activity and stock improvement, as well as the cheap price of options, makes a January call buy a risk I’m willing to take.
To execute this trade you need to:
Buy to Open the INTC January 34 Call
The most you can lose on this trade is the premium paid, or $425 per call purchased.
The risks I see in this trade are the following:
- General market and sector risk (as always)
- INTC earnings announcement expected in late July
- “Peer” Micron (MU) will report earnings today after the close, which could move the semiconductor sector and INTC
That being said, to pay $4.25 for a January call, in a potential turnaround stock story, is a risk I’m willing to take.
| Position | INTC January 34 Call |
| Position Strategy | Buy Call |
| Opened Date | June 28, 2023 |
| Expiration | January 19, 2024 |
| Net Price | 3.74 |
| Strike | 34 |
