Put Options on SNAP on 7/28/2017

Snap Inc. (SNAP) operates as a camera company.

It offers Snapchat, a camera application that helps people to communicate through short videos and images.

The company also provides a suite of content tools for partners to build, edit, and publish snaps and attachments based on editorial content; and Spectacles, which are sunglasses that capture video from a human perspective. 

With Snap's (SNAP) lockup expiration approaching on July 31, JPMorgan analyst Doug Anmuth told investors that he expects further downside into and after that initial date. Snapchat's parent is expected to release quarterly results on August 10.

LOCKUP EXPIRATION: JPMorgan's Anmuth noted that the lockup agreements related to Snap's IPO expire on Saturday, July 29, with the first day of trading on Monday, July 31.

Importantly, the lockup expires before Snap's second quarter earnings release on Thursday, August 10, and as a result, employees will not be able to sell any shares until their trading window opens on Monday, August 14, he added.

The analyst said he believes that some shares are subject to 180-day market stand-off provisions that expire on August 28, and that Snap also has a one-year lockup agreement in place for about 50M shares that were sold in the IPO. Therefore, Anmuth estimated that approximately 1.2B shares will technically become available for sale by the end of August

52-Weeks Trading Range: $13.14 - $29.44

Entry Point: $14.00

Trade Buy 1 August $15.00 Put at $2.00 For a net debit of $2.00 Profit/Loss Analysis Breakeven at $13.00 Maximum profit is unbounded Maximum loss is ($200.00) at strike of $15.00 Closing Summary Sold 1 August $15.00 Put at $3.20

Position closed on 8/11/2017 at price of $3.20 with a 60.00% gain in 14 days.

Updates

8/11/2017 9:36:48 AM

SNAP $15 August Put closed at $3.20

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