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The Portfolio Armor Substack
The Portfolio Armor Substack
Trade Alert: Black Gold Again

Trade Alert: Black Gold Again

Probably an easier way to make money than our recent earnings trades.

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Portfolio Armor
Aug 09, 2023
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The Portfolio Armor Substack
The Portfolio Armor Substack
Trade Alert: Black Gold Again
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Magda Ehlers/Pexels

On The Fence About Social Data Earnings Trades

I’ve been placing a lot of social data earnings trades, using other data sources for confirmation, but to be honest, I’m still on the fence about it. It seems like a tough way to make money consistently: even if you’re right about the earnings more often than not, the performance of the stock immediately afterwards can be a bit unpredictable. In contrast, consider this trade from a couple of months ago.

Another Approach

Trade Alert: Black Gold

Portfolio Armor
·
June 14, 2023
Trade Alert: Black Gold

Pixabay/Pexels Earnings Trade Update Before we get to our oil stock, a couple of updates on the earnings trades front. The firm we’ve been using for social data, LikeFolio, only has one earnings trade this week, one they’re bearish on. But Zacks has a positive earnings

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There, we placed a bullish options trade on an under-the-radar oil company, Evolution Petroleum (EPM 0.00%↑), that had several factors in its favor:

  • Domestic-based, so no foreign political risk.

  • Proven management that had managed to turn a profit during the COVID lockdown-driven oil crash of 2020.

  • Excellent fundamentals, including a Piotroski F-Score of 8 (out of 9).

  • Excellent technicals, with an overall technical rating of 8 (out of 10) via Chartmill.

Since we placed that trade, EPM is up about 23%, and our options trade on it is up 102%, as of Tuesday’s close.

Why This Seems Easier

A few reasons come to mind why this seems easier than our recent earnings trades:

  1. We’re using longer dated options, encompassing two different in earnings releases. This gives us more time for the trade to play out.

  2. We don’t have to worry about whether the company’s product will be in fashion in a few months, or if a competitor will have come out with a better model.

  3. We seem to have a macro tailwind behind us, with the long-feared recession having failed to materialize in the wake of the massive economic stimulus provided by the U.S. government’s unprecedented deficit spending.

This isn’t limited to just oil companies, by the way. We also had success recently with a miner, exiting a bullish options trade on Alpha Metallurgical Resources (AMR 1.67%↑) this week for an 84% gain.

Trade Alert: A Miner Minting Money

Portfolio Armor
·
June 28, 2023
Trade Alert: A Miner Minting Money

Excellent Technicals And Fundamentals This is one of those companies that’s not a household name, but is firing on all cylinders. I’ve got my own bullish and bearish screens set up on Chartmill and this one came up again recently. It’s got an aggregate fundamental rating of 7 (out of 10), a profitability rating of 10, and a

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With all that in mind, I plan to look for these kinds of trades more often, even as I continue experimenting with the shorter-dated, social data-powered earnings trades. And today I’ve found another one.

Another Under-The-Radar Energy Company

This one is more natural gas-focused than EPM, but it produces oil as well. And all of this applies to it as well as EPM:

  • Domestic-based, so no foreign political risk.

  • Proven management that had managed to turn a profit during the COVID lockdown-driven oil crash of 2020.

  • Excellent fundamentals, including a Piotroski F-Score of 8 (out of 9).

  • Excellent technicals, with an overall technical rating of 8 (out of 10) via Chartmill.

It could potentially work as a short-term earnings trade, as the company is releasing earnings this week, but our trade goes out to November, so if this week’s earnings aren’t as good as expected, we have more time for this one to play out.

Details below.

Our Bullish Oil & Gas Trade

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