Doctor Jack's Stock Medicine

Jack,
If I read your post correctly, you have a max. possible gain of just twelve cents (and then, subtract commisions). Is this correct?

12 cents times 80,000 ain't nothing and seems to be in line with his other gains dollar-wise...and if I recall correctly he's trading for GS or MS so commissions aren't in the equation, right Jack?

Slb

I've been watching SLB since I own a little (very little compared to your 1 block). I noted the huge resistance at $62.47, and now I know why: you were selling into strength. Looks like you sapped all the strength out of it for today, too.

10,000 shares relative to the daily average volume does not cause the stock to fetch in technicality. However, I may have influenced other bidders to follow.

Mrvl

Bought 5 blocks at 18.41, and wrote 500 Nov 18.75 for .75/contract

[New-born baby]

sold 1 block of SLB at 62.47, and covered the Nov 62.50 calls at 1.70/contract for a net profit of 22 cents/share times 10,000 shares.

I've been watching SLB since I own a little (very little compared to your 1 block). I noted the huge resistance at $62.47, and now I know why: you were selling into strength. Looks like you sapped all the strength out of it for today, too.

Intc

Jack,
If I read your post correctly, you have a max. possible gain of just twelve cents (and then, subtract commisions). Is this correct?

Correct. I'm hoping to get called away. But, i fit dips below 20 by expiration, then I'll cover the calls and retain the shares in an incremental fashion as I see fit.

Slb

Bought 1 block of SLB at 62.30 and wrote 100 Nov 62.50 calls at 1.75/contract

sold 1 block of SLB at 62.47, and covered the Nov 62.50 calls at 1.70/contract for a net profit of 22 cents/share times 10,000 shares.

[New-born baby]

bought 8 blocks of intc at 20.61 to 21.63, and wrote 800 Nov 20 calls at .75/contract. This is good pullback from a recent high of 22.00

Jack,
If I read your post correctly, you have a max. possible gain of just twelve cents (and then, subtract commisions). Is this correct?

Intc

bought 8 blocks of intc at 20.61 to 21.63, and wrote 800 Nov 20 calls at .75/contract. This is good pullback from a recent high of 22.00

Amd

Bought 6 blocks of AMD at 20.72, and wrote 600 Nov 20.00 for 1.25/contract. Still an excellent intrinisic value remaining till Nov expiration

[Websman]

I liked MRVL so much, I went ahead and bought it @18.48. Looked like a good entry...we shall soon see.

My entry sucked! Sssssssssssssjeeeeejejeeeeeeee

[Websman]

I'll take a look at MRVL...

Thanks for the tip Jack! The chart looks good.

Nem

Bought 5 blocks of NEM at 46.31, and wrote 500 Nov 45.00 calls at 2.05/contract. Company reported revenues this morning that surpassed expectations by 70 million

Mrvl

Ladies and gentlemen,

For those who are looking to accumulate a severely undervalued technology company, you ought to consider MRVL; the stock has lost nearly 60% since Feb of 2006 as a result of buying INTC’s Communications Business for 600 million, and for options backdating. However, none of these two factors shoulf pose a threat to the technology of this company. Besides, the shares have already discounted the news.

Marvell is a fabless provider of chips for communications networking. Their parts are used on small form-factor drives. Seagate in its last quarterly conference call talked about the fact that the only areas showing above-expectations growth right now are notebook drives and small form-factor drives. They also are supplying parts for 802.11 [wireless networking] products, although they haven’t announced who their consumer-electronics customers are yet. That should really pick up for them starting in the third quarter of this calendar year. For Dell, Cisco and Intel, they supply chips used in local-area-network interface cards. They also have a networked-switch-component business. For Western Digital and Seagate, they provide core technology for the interfaces on their drives.
Backing out the cash, the company was selling at at 22 times next year’s earnings when the stock was at 39. Now, It sells at under five times this year’s net revenue, or about three times expectations for next year, with very high margins. Marvell has been growing far faster than the overall chip market, with sales expected to reach $2.4 billion in the January 2007 fiscal year, up from $1.7 billion in fiscal 2006 and $1.2 billion in fiscal ‘05. And almost all of that has come from organic growth, rather than acquisitions.

Mavell said the deal will give them a strong position in the market for processors used in smart phones. The Intel business changing hands includes a processor used in Research in Motion’s Blackberry 8700 device, and another processors used in the Palm Treo and Motorola Q phones.

The comunications business that MRVL bought from INTC has about 1,400 employees, and has been generating about $100 million a quarter in revenue; the company said the Intel unit has margins lower than those Marvell has been reporting. In a conference call with analysts this morning, the company said it expects that starting fiscal 2008 it will expect long-term gross margins of 50% and long-term operating margins of 24%. In a company where the top execs still control 20% of the stock, management is not out there doing stupid acquisitions. They are willing to take a short-term earnings hit for a deal that will be accretive in the long haul.

For those looking for an entry at today’s price, consider buying the shares while hedging them with the Nov 18.75 strike calls at nearly 70 cents/contract. That gesture will give you a .70 cent/share downside protection, providing you the opportunity and the affordability to dollar cost average, should the stock decline. Thereafter, I would buy more shares and hedge with the 17.50 strike price.

All in all, if you can risk a 2 point downside in exchange for a 20 point upside on a stock, MRVL is a great pick!

Mrvl

Bought 7 blocks at 17.78 to 17.80, and wrote 700 Nov 18.75 calls at .55/contract. Strange strike price.

Sold 7 blocks on MRVL at 18.33 to 18.35, and covered the calls at .65

Mrvl

Bought 7 blocks at 17.78 to 17.80, and wrote 700 Nov 18.75 calls at .55/contract. Strange strike price.