Amazon’s most recent trend suggests a bullish bias. One trading opportunity on Amazon is a Bull Put Spread using a strike $1785.00 short put and a strike $1780.00 long put offers a potential 23.46% return on risk over the next 6 calendar days. Maximum profit would be generated if the Bull Put Spread were to expire worthless, which would occur if the stock were above $1785.00 by expiration. The full premium credit of $0.95 would be kept by the premium seller. The risk of $4.05 would be incurred if the stock dropped below the $1780.00 long put strike price.
The 5-day moving average is moving up which suggests that the short-term momentum for Amazon is bullish and the probability of a rise in share price is higher if the stock starts trending.
The 20-day moving average is moving up which suggests that the medium-term momentum for Amazon is bullish.
The RSI indicator is at 58.3 level which suggests that the stock is neither overbought nor oversold at this time.
To learn how to execute such a strategy while accounting for risk and reward in the context of smart portfolio management, and see how to trade live with a successful professional trader, view more here
LATEST NEWS for Amazon
Alibaba Spends $3.3 Billion to Raise Stake in Delivery Arm
Fri, 08 Nov 2019 09:31:45 +0000
(Bloomberg) — Alibaba Group Holding Ltd. will spend $3.3 billion to raise its stake in Cainiao, in an effort to exert more control over the logistics subsidiary that underpins its sprawling e-commerce empire.The Hangzhou-based company will lift its stake in Cainiao to 63% from 51% by subscribing for newly issued shares in its latest financing round and buying existing stock from another holder, the company said on Friday.Six-year-old Cainiao is the rapidly growing business that sits at the heart of Alibaba’s expansion — both in China and abroad. It oversees a coterie of at least a dozen shipping partners, orchestrating deliveries carried out by millions of people across the country.The increased stake could help Alibaba expand deeper into the business of setting up and controlling its own infrastructure, much like Amazon.com Inc. Billionaire Jack Ma said in May last year that he wanted to invest 100 billion yuan ($14 billion) in logistics without giving a time frame.Read more: Alibaba’s Ma Says to Invest at Least 100B Yuan on LogisticsCainiao’s revenue, after elimination of inter-company transactions, rose 48% to 4.8 billion yuan in the quarter ended September.The logistics giant is expanding at a rapid clip, keeping pace with its parent’s online retail business. It’s developed a neighborhood delivery service with a combination of stations and self-pickup lockers, known as Cainiao Posts, a key to bolstering last-mile delivery. The daily package volume handled by Cainiao Post doubled in September, compared with last year, according to Alibaba’s filings.Cainiao’s Guoguo app, which offers crowd-sourced parcel pick-up and delivery services, had 100 million annual users at of the end of August. Its parcel volume more than doubled in the September quarter, compared with last year, according to its filing.Alibaba created Cainiao with the department-store chain Intime Retail Group Co. and industrial conglomerate Fosun International Ltd. The trio led an initial investment of 100 billion yuan into the company to build out its logistics network.The company has since managed a delicate relationship with its delivery partners, as players jostled for business and valuable user data. Alibaba’s facing increasing competition in delivery from Pinduoduo Inc., China’s No. 3 platform. Pinduduo is seeking to take control of its own data by developing in-house shipping information technology.Read more: E-commerce Upstart Pinduoduo Wants its Data Back From Alibaba(Updates with details on logistics from the third paragraph)To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at firstname.lastname@example.orgTo contact the editors responsible for this story: Peter Elstrom at email@example.com, Edwin Chan, Colum MurphyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
How the World’s Biggest Leveraged Buyout Could Be Done
Fri, 08 Nov 2019 07:31:01 +0000
(Bloomberg Opinion) — The mooted record-breaking leveraged buyout of Walgreens Boots Alliance Inc. is a reminder of the powerful role of private capital in modern finance. But the fact that a private equity owner has a chance at making decent returns even after paying a premium for the U.S. pharmacist raises difficult questions. Might the public markets be missing something yet again?A deal for Walgreens would be massive even without a takeover premium. But assume a bidder must pay a proper top-up — say, 20%-30% — and things get really ambitious. That would imply an offer of $85 billion, including assumed net borrowings. The debt component could be about $48 billion on LBO-style leverage multiples, with an equity part of $37 billion. Even with chief executive officer Stefano Pessina rolling over his 16% stake into the new entity, the private equity firms would still have to find close to $30 billion assuming there are no associated disposals.To get there would require more than just a consortium deal. The private equity firms involved would have to call on additional support from their fund investors to support this specific buyout. But such arrangements do exist, and there is a real possibility of putting together such a syndicate to contribute the huge equity commitment. The private capital markets are deep.Now consider the potential gains. To make a deal stack up, the private equity firms would want at least a 15% internal rate of return. This is plausible. Analysts at Credit Suisse Group reckon a Walgreens LBO could generate such an outcome with a bid at a 20% premium that uses debt worth fives times Ebitda. In fact, the drugstore chain could plausibly take its leverage as high as six times Ebitda. On that basis, Citi analysts reckon private equity buyers could clear the 15% returns hurdle by 2025 while paying $77 a share for Walgreens, a 29% premium.It’s not as if the assumptions involved in such modeling are especially racy. Credit Suisse forecasts $11 billion of Ebitda after five years of private equity ownership, with revenues increasing at 3.5% per year. That’s not much more bullish than the consensus analyst forecasts for Walgreens’ near-term sales. Ebitda margins would need to recover to 6.7%. Walgreens achieved that in 2018.In summary, an LBO is a stretch but it could stack up. As ever with a buyout, there are two enablers: the leverage, and the relatively depressed valuation of Walgreens on the stock market. The company may need some restructuring, which tends to result in big upfront charges and losses followed by a period of earnings volatility. Public share prices don’t like that. Moreover, Walgreens has been caught up in the general fear about the health care sector and the disruptive forces hitting retail such as Amazon.com Inc. Might stock market group-think have pushed that too far?A possible Walgreens megadeal may just be top-of-the-market recklessness. But long-term investors should remember that Pessina knows the value of this business better than anyone, and private equity firms see their job as snapping up mis-priced assets.To contact the author of this story: Chris Hughes at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Hughes is a Bloomberg Opinion columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Markets Press Higher as Gold and Bonds Show Correlation
Fri, 08 Nov 2019 04:30:38 +0000
While FAANG stocks are showing mixed results for the year, investors are rewarding Google’s market position.
Here’s exactly what Gates, Bloomberg and Cooperman would pay under Warren’s wealth tax
Fri, 08 Nov 2019 00:56:00 +0000
Sen. Elizabeth Warren has set her sights on taxing the ultra-rich if she’s elected president, but she’s made at least one thing easier for them: A one-click shortcut to see just how much they’d pay.
Where Tech Companies Spent Millions in Municipal Elections—and Lost
Thu, 07 Nov 2019 22:35:51 +0000
Amazon contributed more than a million dollars to a pro-business PAC in Seattle city council races. But that wasn’t the biggest tech spend in local elections.
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