http://finance.yahoo.com/news/lockheed-wins-1-27-billion-211842478.html http://finance.yahoo.com/news/upbeat-aerospace-defense-results-lift-191407629.html "Pentagon’s prime contractor, Lockheed Martin Corp. (LMT), reported an ecouraging first quarter. It reported better-than-expected earnings and revenues with both beating the Zacks Consensus Estimate by 2.8% and 5.5%, respectively. Lockheed Martin raised its 2016 outlook and now expects earnings of about $11.50–$11.80 per share (earlier projection: $11.45–$11.75) on revenues of approximately $49.6 billion to $51.1 billion (earlier projection: $49.5 billion to $51 billion). The stock jumped after the earnings release on solid outlook, impressive revenue growth and potential share buybacks" http://finance.yahoo.com/news/lockheed-lmt-tops-q1-earnings-145902124.html http://finance.yahoo.com/news/sikorsky-acquisition-boosts-lockheeds-revenue-120314518.html http://finance.yahoo.com/echarts?s=LMT+Interactive#{"range":"2y","allowChartStacking":true} Trade: With LMT at 240.26 Jan'17 `85/`80 bull put spread for a net credit of $50 Yield = 50/450 = 11.1 in 257 days or 15.7% annualized Prob = 98% Expectation = .98(50) - .01(450) - .01(225) = 49 - 4.5 - 2.25 = 42.25 Price.......... Profit / Loss........ ROM % 135.00............. (450.00).......... -88.90% 166.73............. (450.00).......... -88.90% 180.00............. (450.00).......... -88.90% 184.50.................. 0.00.............. 0.00% 185.00................ 50.00............. 11.10% 200.13................ 50.00............. 11.10% 233.53................ 50.00............. 11.10% 266.93................ 50.00............. 11.10% 300.33................ 50.00............. 11.10% beats making tootsie-rolls for a living. (beware of defense spending cuts)
LMT's rise in stock price over the past half-decade has been breathtaking. I bought a few shares a while back, but I keep kicking myself for never buying more. I was always telling myself "wait for a pullback". There hasn't been one.