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Call Options on BGS on 6/7/2016

Bullish Flag on BGSB&G Foods, Inc. (BGS) manufactures, sells, and distributes a portfolio of shelf-stable, and frozen food and household products in the United States, Canada, and Puerto Rico.

Its products include frozen and canned vegetables, hot cereals, fruit spreads, canned meats and beans, bagel chips, spices, seasonings, hot sauces, wine vinegar, maple syrup, molasses, salad dressings, pizza crusts, Mexican-style sauces, dry soups, taco shells and kits, salsas, pickles, peppers, tomato-based products, puffed corn and rice snacks, nut clusters, and other specialty products.

The company markets its products under various brands, including Ac'cent, B&G, B&M, Baker's Joy, Bear Creek Country Kitchens, Brer Rabbit, Canoleo, Cary's, Cream of Rice, Cream of Wheat, Devonsheer, Don Pepino, Emeril's, Grandma's Molasses, Green Giant, JJ Flats, Joan of Arc, Las Palmas, Le Sueur, MacDonald's, Mama Mary's, Maple Grove Farms of Vermont, Molly McButter, Mrs. Dash, New York Flatbreads, New York Style, Old London, Original Tings, Ortega, Pirate's Booty, Polaner, Red Devil, Regina, Rickland Orchards, Sa-són, Sclafani, Smart Puffs, Spring Tree, Sugar Twin, Trappey's, TrueNorth, Underwood, Vermont Maid, and Wright's.

It also sells and distributes household products under the Static Guard brand. B&G Foods, Inc. offers its products directly, as well as through a network of independent brokers and distributors to supermarket chains, food service outlets, mass merchants, warehouse clubs, non-food outlets, and specialty distributors. 

Shares have formed a bullish "flag" following the company's latest quarterly report. The Company reported fiscal 1Q16 net sales of $353.0 million—a rise of 62.6% compared to net sales of $217.1 million in fiscal 1Q15. The company’s cost of goods sold as a percentage of net sales fell by 2.9%. Its operating income rose by 74.0% in fiscal 1Q16—compared the same period the year before. It reported a loss on extinguishment of debt of $2.8 million in fiscal 1Q16. Its net income and EPS (earnings per share) rose to $33.2 million and $0.56, respectively, in fiscal 1Q16—compared to $19.6 million and $0.36, respectively, in fiscal 1Q15.

We will trade July 15th Call Options.

52-Weeks Trading Range: $28.12 - $44.84

Last Trade: $44.31

 

Trade

  • Buy 1 July $45.00 Call at $0.80
  • For a net debit of $0.80

Profit/Loss Analysis

  • Breakeven at $45.80
  • Maximum profit is unbounded
  • Maximum loss is ($80.00) at strike of $45.00

Closing Summary

  • Sold 1 July $45.00 Call at $1.50

Position closed on 6/21/2016 at price of $1.50 with a 87.50% gain in 14 days.

Updates

6/21/2016 10:21:51 AM

We are taking profits on BGS call options.

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