2015-03-25 Bears Target Multi-Year Lows In Applied Micro Circuits (AMCC)


Posted on March 25th, by Mitchell Warren in Free Articles, Options Risk Management, Trade Ideas. Comments Off on 2015-03-25 Bears Target Multi-Year Lows In Applied Micro Circuits (AMCC)

Bears Target Multi-Year Lows In Applied Micro Circuits (AMCC)

Applied Micro Circuits

Notes: The “bear market” in Applied Micro Circuits is warranted when you consider the highest quarterly profit in the last few years is $0.03 and has turned for the worse with losses of $0.06 and $0.09 in Q2 and Q3 of FY15. For the year they are projected to lose $0.24 in EPS on revenue of $164M (-24% year over year). Bears are still content on the $300M semiconductor company slipping to multi-year lows, currently holding more than 8.5M shares short (12% of the float). Given all of the unusual bearish put purchases today in the higher quality tech companies (see today’s Options Report) it is unlikely to see a company with a streak of annual negative free cash flow outperform in the short-term. Q4 earnings are due out around April 23rd.

Applied Micro Circuits (AMCC) Options Trade Idea

Buy the (AMCC) May $5 put for $0.55 or better

Stop loss- None

1st upside target- $1.00

2nd upside target- $1.25

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