Call Options on FL on 8/30/2012

Foot Locker leads the pack in the race to capture the biggest share of the global athletic footwear market. The company is a leading retailer of athletic shoes and apparel, with more than 3,350 specialty stores in 20-plus countries in North America and Europe, as well as Australia and New Zealand. Its 1,900-store namesake Foot Locker chain is the #1 seller of name-brand (NIKE) athletic footwear in the US. The company also operates stores under the Lady Foot Locker, Kids Foot Locker, Footaction, Champs Sports, and CCS banners. In addition to its bricks-and-mortar business, Foot Locker markets sports gear through its direct-to-customer unit, which consists of catalog retailer Eastbay and Footlocker.com

Stockwinners is bullish on this name for the following reasons: 

1. Stockwinners is hearing rumors that FL is going to be featured on a major stock advisory firm as stock of the week 
2. Volatility is low on this name and hence options are relatively cheap compared to rest of the markets 

Trade: Buy 1 Sept $35 Call for less than $.60

Breakeven & Profit/Loss analysis 

• Breakeven at $35.60 by Sept expiration 
• Profits are unlimited above $35.60 by sept expiration 
• loss up to $0.60 between $35.60 to $35 , max loss $0.60

The payoff table is presented below: 

Trade Buy 1 September $35.00 Call at $0.60 For a net debit of $0.60 Profit/Loss Analysis Breakeven at $35.60 Maximum profit is unbounded Maximum loss is ($60.00) at strike of $35.00 Closing Summary Sold 1 September $35.00 Call at $1.45

Position closed on 9/19/2012 at price of $1.45 with a 141.67% gain in 20 days.

Updates

9/19/2012 10:19:38 AM

Stockwinners is happy with the gains and is closing out this position .  please adjust your stop-loss if you still want to stay long. 

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