UNH investors will definitely be on alert on 29 July when the company reports its earnings. We know the results likely won’t be good—but are they bad enough for the share price to drop into the $300 range?
Needless to say, two scenarios could happen:
1. The stock rebounds after earnings, possibly back to $400+, or
2. It crashes to $200+.
The option premium from selling puts or calls expiring on August 1 looks rather lucrative. Overall, I'm still bullish on UNH and have placed a put at $280 to add more shares if it really drops. I doubt it will fall below $260, but anything can happen.
I currently hold 300 shares and have sold a covered call at $400. I may consider placing another lot around the $350 range to collect the high premium, and possibly another around the high $300s. I'll decide after my current two options contracts expire on 25 July.
Keeping my fingers crossed [Happy]
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- Venus Reade·07-12I can see a good 10%-20% rapid drop before this starts to recover for real. Fake outs happen all the time to flush out weak hands and lure in shorts to help propel the rally.LikeReport
- Enid Bertha·07-12i think the medicare scare is not real and this stock will fly.LikeReport
- winzy·07-12Interesting strategyLikeReport
- AuntieAaA·07-13GoodLikeReport