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Doubling Down On A Magnificent 7 Name

Doubling Down On A Magnificent 7 Name

If the current rotation out of Mag-7 stocks proves short-lived, this should do well. If not, not.

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Portfolio Armor
Jul 17, 2024
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The Portfolio Armor Substack
The Portfolio Armor Substack
Doubling Down On A Magnificent 7 Name
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An illustration of doubling down on a bullish bet on a Magnificent-7 stock. The scene shows a stock market graph trending upwards with a bold green arrow indicating a bullish trend. There are two large dollar signs at the base of the arrow, symbolizing doubling the investment. In the background, silhouettes of the Magnificent-7 stocks (such as Apple, Amazon, Google, Meta, Microsoft, Nvidia, and Tesla) are depicted as recognizable icons or logos, subtly integrated into the upward trend of the graph. The overall color scheme is green and gold, conveying prosperity and growth.

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Doubling Down On An Earnings Trade

Earlier this month, we placed a bullish bet on a Magnificent 7 stock.

Trade Alert: Post-Earnings

Portfolio Armor
·
July 2, 2024
Trade Alert: Post-Earnings

Three Trades On Track For 200% Gains As we mentioned in our Exits post on Saturday, two of our open trades were on track for 200% gains, one on SalesForce (), and one on Carvana (). With today’s move in Tesla () shares, we now have three trades on track for 200% gains. The max gain (of about 207%) for our Tesla trade in the post below is with Tesla trading over $205; Tesla is trading at about $229 as I type this.

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In that post, we wrote:

Today’s trade is another post-earnings trade. Like SalesForce, this is a stock that dropped post-earnings, but unlike SalesForce, this one beat on both earnings as well as revenues. Like SalesForce, this growth tech stock now has a Chartmill Valuation Rating of 6 (on a scale from 0 to 10). Some other ratings it currently has:

  • Profitably: 8

  • Health: 7

  • Growth: 7

  • Technical: 10

  • Piotroski F-Score (on a scale of 0 to 9): 8

I placed a limit order on this one a couple of weeks ago, and it just filled today. This is a bet that the stock will climb about 3% from here over the next few weeks. If it does, we’ll be able to exit for about a 200% gain.

After today’s drop in the stock, as part of what looks like a heavy rotation out of Mag-7 names, we’ll need about an 11% move from here to get the maximum return on today’s trade, but that is well within the expected move for this name post-earnings.

If the current rotation out of Mag-7 stocks reverses before this stock releases earnings in a couple of weeks, we could make a ~220% gain on this trade; if not, we could lose 100%.

Details below.

Today’s Bullish Mag-7 Bet

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