All three of the companies listed below are to report earnings throughout this week and could be very volatile trade opportunities which is exactly what I look for at JasonBondPicks. Before we take a look at each stock and their charts, let me make it clear that I generally don’t swing trade through earnings, but instead use the walk up and volatile days after to trade for profit.
Quepasa.com Inc. (AMEX:QPSA) is first to report Monday 11/14/2011 after the close. Just last week they closed the myYearbook merger and which means the executives of myYearbook will be in on today’s call. Recently I traded and alerted QPSA from $2.95 to $4.73 for a 60% win on the long side. Then last week I jumped back in with 40 call options at $.60 essentially shelling out $2,400 to control 4,000 shares instead of about $18,000 to buy the stock. Friday’s strong news with Coca-Cola sparked a 19% run from $4.12 to $4.90 putting me up over 50% again on QPSA. If the outlook is good today and the price breaks $5 like I expect, then the upside can be very substantial. After locking in 60% a few weeks ago, this option play limited my exposure to while allowing me the opportunity to play what could be an excellent conference call.
E-Commerce China Dangdand Inc. (NYSE:DANG) is set to report Wednesday 11/16/2011 after the close. The market is betting on a small deficit out of the Chinese e-tailer. Dangdang posted quarterly profits in its first two quarters as a public company following last December’s IPO, but now it’s working on what is likely be its second straight money-losing quarter. I’m not sure I’ll swing DANG as a runup just yet but I do like the support here around $5.50 into Wednesday. If I don’t try and play the runup into earnings, I’ll be watching close Wednesday once the market closes and if DANG doesn’t impress, I’m considering a buy at $4.50 or the recent low.
Wet Seal, Inc. (NASDAQ:WTSLA) is the last on this list to report on Thursday 11/17/2011. They have already guided lower on a -9.7% decline in comparable October store sales which caused a 24% drop in the price action. Coming off a bottom of $3.07 shares have bounced 7% already no doubt due to short cover and dip buyers. With 52-week support around $3.10 and clear oversold status, there are a number of ways I’ll look to play this swing trade long heading into earnings and after earnings.
Disclosure: I am long QPSA
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