Closing Out CVS
Closing Out CVS Health (CVS) Hello Smart Option Sellers! We currently hold a put-sell position in CVS which we're going to close out today for a small profit. CVS released earnings on Wednesday which definitely underwhelmed the market. The stock dropped about $5 per share and has since dropped another $3. The stock currently trades for $61.30 per share, still a fat $13.80 per share above our $47.50 strike price. I wouldn't be so worried about a move like that, considering the cushion we still have and that the option price is still below our entry sell price. What worries me is the recent news that a class-action lawsuit has been opened against CVS which links the company and some of its officers to possible securities fraud. Whether this is true or not, I never like to hear the word "lawsuit" with a stock that we're involved with. I hate to close this one out, but you know me - I always err on the side of caution. Let's go ahead and grab the small gains that are still available for this trade. Here's what you can choose to do: Note: you will only execute today's trade if you already hold the put-sell position in your account. If you don't have the position, you can disregard these instructions. Buy back (buy-to-close) all of your CVS May 17, 2019 $47.50 put options for a limit buy price of $.20 per contract or lower, GTC, as a closing transaction (buy-to-close). Currently, this put option has a market of $.17 bid/$.19 offer, so we should definitely be able to buy some for cheaper than $.20 per. Try putting in an $.18 bid at first to see if anyone bites. Give it a few minutes, and if they're no takers, you can move up to $.19, and then $.20 if necessary. Remember, if the stock starts to move up, the put option price will drop. So maybe you want to watch it for a few minutes. With the overall market being strong today, it could help lift CVS stock from its doldrums. That's all for now. Get those orders in there and let us know how you do. Continue to hold all other open positions as-is. Contact me here with fills, comments, questions or concerns. I will get the Q&A alert out a bit later today. Regards,
Lee Let's Grab That Cash!