Dynamic Wealth Report | Wednesday, December 19, 2012
How $1,000 Turned Into $3,174,588 in Three Months
If you are one of the investors who missed this year's monster cash-grab, current market events are setting up for another massive windfall. Using this simple to follow system, investors are getting ready to cash in again. Don't miss this one.
Now Is Your Time to Cash in. Get The Full Details and This Free Report…
The Spread Trader: Can 3-D Printing Stocks Keep It Up?
By Corey Williams, Options Trading Research
 Some of the hottest stocks of 2012 are those of companies that specialize in 3-D printing.
In a nutshell, 3-D printers convert digital objects in computer-aided design software or 3-D scanning and sculpting devices into physical objects mad from plastic, metal, and composite print materials.
The two major players in 3-D printing are 3D Systems (DDD) and Stratsys (SSYS). So far this year, DDD is up a whopping 218% and SSYS has gained 124%.
These high flying stocks are a growth investor's dream.
DDD's earnings per share (EPS) have grown at an average of 95% per year over the last five years. And EPS are growing 67% this year. Not to be out done, Stratsys' EPS growth is off the charts at 114% this year.
The catalyst for the surge in earnings growth is price. The cost of 3-D printers has fallen dramatically this year. The introduction of 3-D printers that cost under $1,000 has opened up new and profitable markets for DDD and SSYS.
But here's the thing…
It's nearly impossible for DDD and SSYS to continue growing earnings at this pace.
In fact, analysts project DDD's EPS to grow at 14% and SSYS at 20% per year over the next five years. That's a far cry from the 67% and 114% EPS growth rates this year.
If DDD and SSYS don't live up to investors sky high expectations, they're doomed to come crashing back to earth. Put simply, 3-D printing stocks strong performance is running ahead of the fundamentals.
Let's take a closer look at DDD…
At a recent price of $47.68, DDD has a P/E ratio of 68. That means investors are paying $68 for every $1 the company earns. Even if they manage to hit their lofty EPS estimates of $1.57 next year, the stock is still trading at forward PE of 30x next year's earnings.
If there's even a hint that DDD growth rate is slowing, we could see a massive correction in the stock price.
This looks like a great opportunity for a bear put spread on DDD. This bearish strategy is made by buying one put option and selling another put option at a lower price.
Here's what to do now…
Buy the DDD May 2013 $45 put for $5.82 and sell the DDD May 2013 $35 put for $2.00.
Remember, when buying a put spread, the maximum profit is the difference between the strike prices minus the amount paid for the spread.
This trade costs us $382 ($582 - $200) per contract. Our breakeven on the trade is $41.18. If DDD is trading at exactly $41.18 on May 17th, we'll get our $382 back.
We've also limited our risk to our initial $382 investment. If DDD is trading above $45 on May 17th, we'll lose $382. But no matter how high DDD goes, we can never lose more than our initial investment.
Now for the good part… profits!
Our maximum profit of $618 comes if DDD is trading at or below $35 on May 17th.
In other words, we're risking $382 for a chance to make $618. According to our tracking system, there's a 35% chance of this trade making money. That's a good risk/reward in my book.
Good Investing,
Corey Williams
A Near-Perfect Track Record... And The Chance To Turn $2,000 Into $91,771 In The Next 4 Months!
That's right! This simple, yet powerful trend-following system has produced staggering profits year in and year out.
Even better, these results do not take very long to achieve...
Discover what Wall Street professionals and market insiders are doing that most individual investors don't have a clue about...
Click here to get the details!
| | | | | | | Copyright 2012 Hyperion Financial Group, LLC. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This email may only be used pursuant to the subscription agreement controlling use of the Dynamic Wealth Report website and any reproduction, copying, or redistribution of this email or its contents, in whole or in part, is strictly prohibited without the express written permission of Hyperion Financial Group, LLC.
LEGAL DISCLAIMER: Neither Hyperion Financial Group LLC nor any of it's employees, contractors or officers are registered investment advisors or a Broker/Dealer. As such, Hyperion Financial Group, LLC does not offer or provide personalized investment advice. Although Hyperion Financial Group, LLC employees and contractors may answer general customer service questions, they are not licensed under securities laws to address your particular investment situation. Nothing in this report, nor any communication by our employees or contractors to you should be considered personalized investment advice.
Owners and writers may have positions in the securities that are discussed. However, no associated employees or contractors may intentionally engage in any transaction that directly or indirectly competes with the interests of our subscribers. We accept no compensation from any companies mentioned in our reports.
Past performance is no guarantee of future results. All information is issued solely for informational purposes and is not to be construed as an offer to sell or the solicitation of an offer to buy, nor is it to be construed as a recommendation to buy, hold or sell any security. All opinions, analyses and information contained herein are based on sources believed to be reliable and written in good faith, but no representation or warranty of any kind, expressed or implied, is made including but not limited to any representation or warranty concerning accuracy, completeness, correctness, timeliness or appropriateness. Investments recommended in this publication should only be made after consulting with your financial advisor. | |
No comments:
Post a Comment
Keep a civil tongue.