A few weeks ago, I sent you an alert on Columbia Sportswear (Nasdaq: COLM), our winter weather clothier. Shares have been volatile since then thanks to fellow retailers reporting weak earnings, just like Macy’s did today.
However, as I’ve mentioned before, those companies are not tied to our winter-weather trend. In fact, Columbia Sportswear announced earnings late last month that blew past expectations and sent shares significantly higher. Our calls jumped as a result, but the stock drifted back too quickly for us to lock in profits, which is why our limit orders are still in place.
But now because of Macy’s poor earnings, which have put pressure on the entire retail industry, we have a chance today to double down on our current position and reap even larger gains.
Columbia Sportswear has proved things are not as bad for them as other retailers, so let’s take advantage of the recent volatility in the retail sector.
Action to take: Buy to open the COLM January 2016 $55 call option (COLM160115C00055000) at the market. At last glance, it was trading at $1.70.
This way, we get the chance to collect greater gains — and at a cheaper price than we paid before.
That’s all for today, but remember that I’ll be back tomorrow to explain our new trading strategy.
Until next time, good trading…
Editor, Precision Profits