Saturday, June 02, 2007

A Winning Trade - Blue Coat Systems Inc. (BCSI) Q4 Earnings

Dear fellow options traders :

Noted that Blue Coat Systems Inc. (BCSI) would be reporting 4th quarter earnings on 29 May 2007 after market closed. After some research, I'm convinced BCSI would report good earnings for Q4. These were my findings :-

1) positive commentaries from about BCSI strong foothold in WAN Optimization Products & their recent compliance with Nasdaq listing requirements.

2) significant insider market purchase by 10% owner till March 2007.

3) BCSI tops the industry sector - "Computer Sftwr-Security" from O'Neil Industry Groups, a monthly subscription service from Investor's Business Daily

Thus, I paper traded 2 nos. of BCSI June 40 Call at $275.00 each.

On 30 May 2007, BCSI Reported Q4 earnings of $0.31 per share, ex items, $0.03 better than the Reuters Estimates consensus of $0.28; revenues rose 50.8% year/year to $54.5 mln vs the $53.2 mln consensus.

The company also guided EPS in-line for Q1, expecting EPS of $0.27-0.38 vs. $0.29 consensus; & guided revenues above consensus Q1 revs of $57-60 mln vs. $55.35 mln consensus.

But because of the sharp drop of about 6.3% in China's Shanghai Index, the US Stock market opened rather jittery on 30 May 2007 thus BCSI didn't really gap up after earnings announcement.

But the market sentiment steadily improved and BCSI went up correspondingly about +$2.00 intra-day to close at $43.00. On 31 May 2007, I sold the 2 contracts at $360.00 each for a profit of about $140.00 (including commissions).

Related Trade in my Stock Options Trading Blog

If you've managed to find out about the Live Freely! Seminar from my stock options trading blog and subsequently sign up for it, I hope you could do me a kind favour and mention Mr Tony Chai from Batch 14 as the referrer. Thank you for your kindness.

Wishing you Profitable in your Options Trading too.

Yours Sincerely,

Tony Chai


Anonymous said...

Hi tony,
You inspired a lot thing through your blog and your suggestion with Clemen chang Seminar,

May I have your email address?
Or could we chat since we are from the same graduate?

this is my email

Thanks tony.