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This is the Most Actively Sold Stock in June

Posted: 09 Jun 2020 04:30 AM PDT

As you look across the landscape of insider trading, you'll find a lot more selling than buying right now. That makes sense given the huge run the market has made in the past couple months. Insiders who are aware of the financial difficulties in our current environment and weathering another sharp downturn may not be the most desirable. Also, given the amount of executive stock-based compensation that's been given, eventually the flow will start to head into the market as the profits are booked.

With that in mind, seeing companies that have a significant number of insiders selling is a more bearish indication than fewer in many circumstances. In the case of Amphenol Corporation (NYSE: APH), the company highest amount of insider selling transactions of any company that optionable with at least $10 million in value traded daily and one million average volume. This allows the options to be reasonably liquid to trade.

Since June 1, the company has had 8 different sell transactions with 7 different insiders. They sold 767,582 shares for a total value of $79.12 million. The biggest transaction was made by President and CEO, Richard Norwitt, at 525,000 shares.

Here are links to the last two insider trading reports.

This was the Most Bought Stock by Insiders Last Week

Founder of this Cloud HR Company Just Turned into a Seller

Action to Take: APH is currently testing its 52-week high near $110. On Monday, the price traded lower and closed near Friday's low. A close below $104.16 on above average volume is an indication that the price may test $97.50.

Option traders may wan to consider selling the 17 JUL 20 105/110 short call vertical for around $2. That gives a max gain of $200 or 67% ROR if the price closes at or below $105. Consider closing early for $1 or less.

The post This is the Most Actively Sold Stock in June appeared first on Trading Tips.

Option Traders Looking More Closely at this Mobile Gaming Stock After Its Pullback

Posted: 09 Jun 2020 04:30 AM PDT

Zynga Inc (NASDAQ: ZNGA) is a mobile gaming company that has hits like Farmville, Mafia Wars and CityVille. The company began its turnaround in 2016 after going public in 2011. The hiring of the former Electronic Arts Inc (NASDAQ EA) executive Frank Gibeau helped initiate the turnaround that was declared complete in 2019. With more people staying at home, gaming companies have had an opportunity to shine.

On May 29, 2020, the stock price of ZNGA broke out on high volume. The price continued up another day before pulling back for the next four days. On Monday, the price began to firm up and the share price began moving higher.

While ZNGA had a couple of large orders get filled in one print, it was the cumulative activity that was skewed more bullishly with 44% of the calls getting filled at the ask price.  The activity centered on the 12 JUN 20 $9, $9.50 and $10 call options. Each of the strikes had more volume than open interest, with the largest print occurring on the 12 JUN 20 $9 call for 1,000 contracts at $0.17.

Here are links to our last two unusual option activity reports.

Option Traders Converge as Option Activity Explodes on this Auto Manufacturer

Option Traders Seeing a Top in High Yield Credit

Action to Take: The bullish setup following the short pull-back last week gives it a near-term target of $10, which is near the June 2 high.

Option traders may want to consider the 17 JUL 20 9/10 long call vertical for around $0.32. The max gain of $68 or 212% is achieved if the price closes above $10 at expiration. Consider selling early at $0.70 or higher.

The post Option Traders Looking More Closely at this Mobile Gaming Stock After Its Pullback appeared first on Trading Tips.

5 Stocks to Buy in a June Swoon

Posted: 09 Jun 2020 04:30 AM PDT

The market has been screaming higher over the past couple weeks as the advance has come with the leadership of the big technology and communication names. That is a good sign as the more value-oriented parts of the market are starting to move along with financials and industrials. That being said, it may be the last phase of this crazy ride we're on as the summer months lead to some profit-taking.

The idea is to be prepared with a list of names that you would like to buy into weakness. Typically, some of the top prospects are companies that pay a consistent dividend and have been growing it for a long time. This feature is the sole consideration for the Dividend Aristocrats list. These are S&P 500 companies that have paid and grow their dividend for at least 25 years.

The following is a list of five Dividend Aristocrats have low debt and payout ratio that makes them excellent candidates to continue paying and growing their dividend in the future. A pull-back will only enhance the yield that you're paid and the near-term opportunity for appreciation.

Here are two other articles on Dividend Aristocrat opportunities.

4 Dividend Aristocrats with Low Debt and Historically High Yield

3 High Yielding Dividend Aristocrats to Buy Now but With Protection

June Swoon Stock #1: Roper Technologies Inc (NYSE: ROP)

Roper has a debt-to-equity of 0.55, which is relatively low compared to other Aristocrats. They pay a current dividend yield of 0.52% and has a payout ratio of only 13%. The company has grown its dividend by 12.2% a year for the past 5 years.

While the yield isn't high for ROP, the company is a growth opportunity with potential to increase its dividend even more significantly. The 3-year revenue growth rate is 11% and its 3-year EPS growth rate is 37.8%. The stock presents an opportunity as the economy gets back to work.

June Swoon Stock #2: Albemarle Corporation (NYSE: ALB)

Albermarle has a debt-to-equity of 0.82, while not high or low, is relatively low compared to other Aristocrats. They pay a current dividend yield of 1.82% and has a payout ratio of only 31%. The company has grown its dividend by 5.7% a year for the past 5 years.

With ALB, the yield is below the S&P 500 average, but a pull-back to the $66 area of support would up the yield to 2.3%. The company has a 3-year revenue growth rate of 12.6% and a current ratio of 1.81. This is a company that is experiencing organic growth and can meet its debt obligations.

June Swoon Stock #3: Expeditors International Inc (NASDAQ: EXPD)

Expeditors has a debt-to-equity of 0.19, which is indication that the company has little debt and has a current cash-to-debt ratio of 2.95. They pay a current dividend yield of 1.31% and has a payout ratio of only 30%. The company has grown its dividend by 8.8% a year for the past 5 years.

The company has a 3-year revenue growth rate of 12% and a 3-year EPS growth rate of 12.8%. They took on debt for the first time at the end of 2019 and has shored up its cash position with a current ratio of 2.26.

June Swoon Stock #4: Hormel Foods Corp (NYSE: HRL)

Hormel has a debt-to-equity of 0.05, which is means it has very little debt which it lowered dramatically in 2019 compared to 2018 while increasing its cash. They pay a current dividend yield of 1.95 % and has a payout ratio of 52%. The company has grown its dividend by 15.6% a year for the past 5 years.

The company has a 3-year revenue growth rate of -0.3% and an EPS growth rate of 3.2%. Its net profit margin of 10.3% and return on equity of 15.45% is an indication of a well-run company with good margins. The lack of growth reflects lack of growth in market share but has been stable with opportunities to grow its dividend even more.

June Swoon Stock #5: Medtronic PLC (NYSE: MDT)

Roper has a debt-to-equity of 0.49, which is relatively low compared to other Aristocrats. They pay a current dividend yield of 2.27 % and has a payout ratio of 61%. The company has grown its dividend by 11.3% a year for the past 5 years.

The company has grown its revenue by 3.6% and its EPS by 11.2%. While the revenue growth isn't huge, the margins have been expanding and currently has a net profit margin of 17.11%. While the company only has a cash-to-debt ratio of 0.46, they have a current ratio of 2.75, which is an indication of the company to meets its obligations.

The post 5 Stocks to Buy in a June Swoon appeared first on Trading Tips.
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