Grab 402% Gains on Idexx Calls

Our Idexx Laboratories (Nasdaq: IDXX) April $125 calls expire a week from Friday.

Let’s put the money in our pocket while the gains are still above 400%.

You’ll recall we sold half the position in February for a 197% profit. Now we should be able to sell the rest of it for at least a 402% gain, based on yesterday’s closing price of the stock.

Because the options expire in a week and they are so deep in the money, there is not going to be much time premium left, so you’ll likely not get much more than intrinsic value.

Intrinsic value is the difference between the stock price and the strike price.

So with yesterday’s closing price of $154.69 and the strike price of $125, the intrinsic value would be $29.69 (154.69 – 125 = 29.69).

You can try to get a nickel more than intrinsic value, but you probably won’t get more than that.

Keep in mind that the intrinsic value will be different from the number above, depending on where the stock is trading when you read this.

Action to Take: Sell the remaining half of the Idexx Laboratories (Nasdaq: IDXX) calls for at least intrinsic value.

Please shoot me a quick email to let me know how you made out on the trade and where you got filled.

Idexx also hit a new 52-week high last week, so we’ll boost the stop price to protect more of our profits.

Action to Take: Raise your stop on Idexx Laboratories (Nasdaq: IDXX) to $137.97.

EU Approves Rockwell Collins – B/E Aerospace Deal

The European Union gave the green light for Rockwell Collins (NYSE: COL) to acquire B/E Aerospace (Nasdaq: BEAV), which removes one obstacle in the merger of the aviation giants.

The deal is expected to close this quarter.

Last week, B/E won a contract from United Airlines to provide economy seats for four different types of aircraft. No word on whether the new seats will make it easier to “re-accommodate” passengers who refuse to give up their seats (sorry, I couldn’t resist).

Rockwell Collins shares hit a new high last week, so let’s raise the stop.

Action to Take: Raise your stop on Rockwell Collins (NYSE: COL) to $80.19.

Raise Stop on HealthSouth

Our oldest position in the portfolio, HealthSouth (NYSE: HLS), has finally started moving. The stock broke out and hit a new high yesterday.

I haven’t seen any news that should have caused the move, but now that it hit a new high, it may catch some investors’ and traders’ attention.

I wouldn’t be surprised to see a quick move up to its all-time high of $48.37.

In the meantime, let’s raise the stop to go along with the new 52-week high.

Action to Take: Raise your stop on HealthSouth (NYSE: HLS) to $35.53.

Trump 10 Update

Some of our Trump 10 stocks, like Worthington Industries (NYSE: WOR) and Carpenter Technology (NYSE: CRS), continue to struggle as President Trump’s infrastructure plans appear to be fizzling in the wake of delays in passing healthcare and tax reform.

Those two policies are his priorities.

We could see infrastructure back in the spotlight if Congress passes healthcare reform in the next few weeks. The latest reports are that House Republicans have made progress with the Freedom Caucus.

It wouldn’t shock me if our infrastructure plays rebounded on a repeal of Obamacare because that would move infrastructure spending up in the line of priorities.

That being said, I would expect some of our healthcare stocks to fall on a repeal. Fewer insured patients mean fewer people who can pay for drugs and other healthcare services.

It’s anyone’s guess as to what will happen regarding the clowns in Washington, so we’ll have to wait and see, and respond if necessary.

In the meantime, we’re doing fine with ManpowerGroup (NYSE: MAN). We’re up on the position, though it has been consolidating for a few weeks. Once it breaks back above its high of $103.90, I expect another strong move higher.

Hoping your longs go up and your shorts go down,

Marc

To view the current Lightning Trend Trader portfolio, click here.

Important Note: Sell stop recommendations are based on closing prices, not intraday prices. If a position closes below the suggested stop, sell your shares at market during the next session.